What other factors should I consider when deciding whether to roll over my 401(k) or 403(b) into an IRA?

When you decide to rollover your 401(k) or 403(b) to Ellevest, we’ll provide an analysis of the investment options, fees, and advisory services in your current plan and at Ellevest. In addition to our recommendation, you may also want to consider the following factors.

 

Working past the age of 70 ½:

If you work past the age of 70 1/2, you are not required to make withdrawals from your 401(k) or 403(b) plan until you stop working. That means the funds in your plan can continue to grow tax deferred until you retire. This is different from an IRA where withdrawals are required starting at age 70 1/2, whether you are working or not.

Filing for bankruptcy:

If you are considering filing for bankruptcy, then funds held in a 401(k) or 403(b) plan are generally protected from creditors. Depending on your state of residency, funds in your IRA may not be fully protected from creditors.

Employee stock:

Keeping employer stock in your plan has tax advantages that will be lost if rolled over to an IRA. If you hold employer stock in your plan, you may wish to keep your employer stock position in your plan and do a partial rollover with the remainder.

 

Disclosures

This information is provided for general informational purposes only. It is not intended to and should not be relied upon as financial, legal or tax advice. Please consult your financial, legal or tax specialists regarding your particular situation.

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