Feeling like it’s time to tidy your personal finances? One of the easiest ways you can clean up your finances (and headaches) is to combine old 401ks from previous employers. Think of it like a Transformer. One is great, but if you combine multiple together, that makes for a super powerful entity!
It’s 2021, do you know anyone that has had only one employer? Here’s another question with the same answer, do you know any unicorns of the animal (not tech) variety? No, but if you do know of any unicorns, holla at us ASAP. Meanwhile, it seems like these days we all have had many employers. You might have money tucked away from a job many moons ago. It’s worth inquiring to find out what that money is up to.
If you have a 401k account from a previous employer you should consider moving it to a current 401k or roll it over to an IRA. Here are a few reasons why:
Lower cost. It might cost you money to leave the money where it is. There are admin fees that employers tack onto accounts of old employees.
Better visibility into what you own. When all of your accounts are in one place, you’re more likely to look at the account and check in.
Fewer statements. Save a tree or two! Account consolidation means less paperwork.
How can you make the change and what is a 401k rollover exactly? Simply put, a rollover is a non-taxable way to move money. It’s non-taxable because the plan beneficiary (you) never receive a check. Funds go directly from your previous 401k into another 401k or IRA. Most online portals will allow you to initiate a rollover from there. Easy!
If you have any questions please reach out. We would love to hear from you. Check out our other blog posts here and if you have a specific topic you would like to learn more about, let us know!