A 401(k) rollover occurs when a person directs the transfer of the money in their retirement account to a new plan or IRA. The most common period when people decide to rollover 401(k) is when they either change jobs or retire. One of the most substantial challenges in rolling over a 401(k) is deciding whether it’s a good idea for you. If you make a bad choice, you can end up facing some substantial obstacles like running out of funds and not being able to afford daily living expenses.
Options besides Rolling Over a 401(k)
One of the most important things about 401(k) rollover is understanding that it is not your only option. Besides a 401(k) rollover, some of the other options that you might consider include: directly rolling over a 401(k) to a new employer’s 401(k) or not transferring a 401(k) to an IRA but leaving the old 401(k) in place. The best estate planning advisors will be able to tell you what strategy will work best in your situation.