Consolidate Your 401k's Into An IRA
The average person switches jobs several times in their life. It is very rare that someone work for the same company the entire length of his/her career. Most companies offer a retirement plan in the form of a 401k, so the average person may come into ownership of several 401k accounts by the time they retire.
So what should you do when you switch jobs and move to another company with it's own 401k offer? It would behoove you to consider a 401k rollover to IRA.
Transferring your 401K to an IRA fund comes with several benefits. I would like to talk now about a few of them.
For starters, imagine someone who changes companies 3 times in their life. That would leave them with 3 401k's from their previous employers and 1 from their current employer. That can get really messy for you. That means you would have 4 times the paperwork to keep up with and monitor to manage your portfolio the way you should. If you are like me, that extra paperwork may cause you to be lax in managing the account and could lead to financial ruin in your retirement years.
Transferring your 401k to an IRA will allow you to consolidate your retirement funds and reduce paperwork therefore making it easier on you to manage and make good decisions for the well being of your financial future. You are able to roll multiple 401k's in to one single IRA. So the person from the example above would only have to deal with their current employer's 401K and one IRA. Much better no?
Also, Leaving your retirement plans in the hands of your previous employers is a bit risky. If the company goes bankrupt you lose everything. Transferring and consolidating those accounts all into 1 IRA with a separate financial institution is much less risky.
This will also allow you to take control of your planning and that is the creates reward. You don't want to depend on others to take care of your retirement because they can't possibly care as much about it as you do.
The 401K offers to match your investment 100%, and you don't see an offer like that from most investment opportunities. So take advantage of it and contribute the maximum that the employer will match. Then put the extra funds into your IRA.
So what should you do when you switch jobs and move to another company with it's own 401k offer? It would behoove you to consider a 401k rollover to IRA.
Transferring your 401K to an IRA fund comes with several benefits. I would like to talk now about a few of them.
For starters, imagine someone who changes companies 3 times in their life. That would leave them with 3 401k's from their previous employers and 1 from their current employer. That can get really messy for you. That means you would have 4 times the paperwork to keep up with and monitor to manage your portfolio the way you should. If you are like me, that extra paperwork may cause you to be lax in managing the account and could lead to financial ruin in your retirement years.
Transferring your 401k to an IRA will allow you to consolidate your retirement funds and reduce paperwork therefore making it easier on you to manage and make good decisions for the well being of your financial future. You are able to roll multiple 401k's in to one single IRA. So the person from the example above would only have to deal with their current employer's 401K and one IRA. Much better no?
Also, Leaving your retirement plans in the hands of your previous employers is a bit risky. If the company goes bankrupt you lose everything. Transferring and consolidating those accounts all into 1 IRA with a separate financial institution is much less risky.
This will also allow you to take control of your planning and that is the creates reward. You don't want to depend on others to take care of your retirement because they can't possibly care as much about it as you do.
The 401K offers to match your investment 100%, and you don't see an offer like that from most investment opportunities. So take advantage of it and contribute the maximum that the employer will match. Then put the extra funds into your IRA.
posted by Debt Consolidation Loan at
1:34 PM
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