Broker Check

401K and 403B Rollovers

Considering IRA Rollovers 

Making the right distribution decision now can make a big difference down the road.

Learn more

If you are planning to take money from your company-sponsored retirement plan, there are important decisions you need to make – sooner than you may think. How will you preserve the retirement funds you have accumulated to provide for your future? There are several considerations that can help protect you from unnecessary or untimely income taxes.


What decisions need to be made?

 • Do you want to leave your money in your current plan? If permitted, you can continue to grow your money tax-deferred, and you may be eligible for penalty-free withdrawals after age 55. 
• Do you want to leave your money in your current plan? If permitted, you can continue to grow your money tax-deferred, and you may be eligible for penalty-free withdrawals after age 55. 
• Do you want to pay the tax later? If you want to keep deferring taxes and maintain control over your money, you can transfer your accumulated assets directly from the current plan into an IRA or another employer’s plan (if the plan allows a rollover).
 • Do you want to pay income taxes this year? If you want to take advantage of the Roth IRA and ultimately withdraw your money tax-free, you can now roll directly to a Roth IRA, which would require you to pay tax on the conversion amount in the year of the rollover to the Roth IRA.
 • Do you want the money now? If you want to take all or part of your money in cash, you will pay ordinary income taxes – and possibly a 10% penalty – on whatever portion is not rolled directly into an individual retirement account (IRA) or another employer’s plan.

Your individual circumstances will determine which option is right for you. Prior to making a decision, it is important to consider all of the available options. 
Prior to retirement, you generally have one source of income – earnings from employment. However, during retirement, your income is likely to come from multiple resources, such as Social Security, pension and investment income. Planning for and managing all of these income streams can be complicated, which is why it is important tot consult with a financial professional.