When you change jobs, there are usually a host of details to consider. An IRA rollover is one way to make sure that your retirement plans don’t get lost in the shuffle. Here’s how it works, for you.
Video Transcript:
When you change jobs, you take a few things with you—a couple personal effects, some experience and a handful of friendships. But what about your retirement account? Forgot that one, didn't you? With all the life changes—and paperwork—of starting a new job, it can be easy to overlook. But tending to that one detail is important. And an IRA Rollover is the way to do it. Here's how it works.
When you leave a job, you have a few options for what to do with your 401(k) plan. One, you can leave it where it is. Two, you can cash it out, and pay a penalty if you're under fifty-nine and a half. The third option, an IRA Rollover, allows you to move the assets from your old company's 401k to an IRA account of your choosing, without paying tax or other penalties.
The IRA account is one you set up yourself with a bank or another financial institution. That means you can set up an account almost anywhere—and choose one that offers you the most options or the best rates. And you can also use a rollover to move your existing IRA accounts to one that may come with better rates, or other features. That's how you can make sure that—along with the experience and friendships—your retirement savings can continue to grow with you over time.
And that's how IRA Rollovers work, for you.