Rollover IRA Options
When it comes to an old workplace retirement account, you have choices

If you’ve changed jobs or are preparing to retire, you may have account balances in one or more workplace retirement plans. To make a thoughtful decision about what to do, make sure you understand your options.

Stay in your plan

If your old plan allows, you may be able to leave your retirement assets right where they are without incurring current income taxes and possible additional taxes for early withdrawal.

Roll over to a new employer plan

If your new employer's plan accepts rollovers, you can move your money to that plan without incurring current income taxes and possible additional taxes for early withdrawal.

Roll over to an IRA

An IRA may provide more flexibility and a wider range of investment options in addition to preventing current income taxes and possible additional taxes for early withdrawal.

Please note that an IRA may be subject to an annual fee, and a fee may be assessed if the IRA is closed.

Depending on your plan's investment options, in some cases, the investment management fees associated with your plan's investment options may be lower than similar investment options offered outside the plan.

Cash out

Get immediate access to your retirement savings. The taxable portion of the distribution is generally subject to a mandatory 20% withholding (you may owe more or less when you file your taxes), plus potential additional taxes for early withdrawal.

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Plan Features Stay in Plan Roll Over to IRA Roll Over to New Employer's Plan Cash Out

Convenience

STAY IN PLAN

A minimum balance requirement of $5,000 might be required. You can maintain your current investments, and you don’t need to take further action.

ROLL OVER TO IRA

Enables you to manage your retirement assets in one location.

  • View your overall financial picture in one place.
  • Reduce number of statements and other communications.

ROLL OVER TO NEW EMPLOYER'S PLAN

May involve a waiting period.

You may be able to consolidate your retirement savings in your new plan.

CASH OUT

Provides immediate access to your retirement plan assets.

Tax Advantages and Disadvantages

STAY IN PLAN

Keeps your assets tax-deferred (not taxable until you access your savings).*

ROLL OVER TO IRA

Assets are tax-deferred (meaning not taxable until you access your savings).*

ROLL OVER TO NEW EMPLOYER'S PLAN

Assets are tax-deferred (meaning not taxable until you access your savings).*

CASH OUT

Removes potential for continued tax-deferred or tax-free growth of your assets.

Mandatory 20% withholding on distribution may apply. May be subject to 10% additional tax for early withdrawal if you are under age of 59½ (some exceptions apply, please contact a tax advisor).

Access to Money

STAY IN PLAN

If your plan offers loans, they are typically only available for active employees.

Generally allows for penalty-free withdrawals if you retire the year you turn 55 or older. Otherwise, penalty-free withdrawals are available after age 59½.

Waive early IRS distribution penalties if certain requirements are met, regardless of age. Some examples include unreimbursed medical expenses, disability, and qualified military reservists called to active duty.

ROLL OVER TO IRA

No loan provisions.

Withdrawals available without penalty after age 59½.

Waive early IRS distribution penalties if certain requirements are met, regardless of age. Some examples include unreimbursed medical expenses, disability, higher education expenses, first-time home purchase, and qualified military reservists called to active duty.

Must begin taking required minimum distributions (RMDs) after age 70½ (except for Roth IRAs).

ROLL OVER TO NEW EMPLOYER'S PLAN

Loans may be available.

Generally allows for penalty-free withdrawals if you retire the year you turn 55 or older. Otherwise, penalty-free withdrawals are available after age 59½.

Possible to delay taking RMDs if you are still working at age 70½.

Waive early IRS distribution penalties if certain requirements are met, regardless of age. Some examples include unreimbursed medical expenses, disability, and qualified military reservists called to active duty.

CASH OUT

Allows immediate access to your retirement plan assets.

Investment Choices

STAY IN PLAN

Limited investment options.

Offers familiar investment options.

May provide access to company stock or other investment options not available outside of the plan.

ROLL OVER TO IRA

Access wider range of investment options.

Consult a tax advisor to determine the appropriate strategy if plan investments include company stock.

ROLL OVER TO NEW EMPLOYER'S PLAN

Investment choices limited to those in the plan.

May provide access to company stock or other investment options not available outside in the plan.

CASH OUT

N/A

Future Contributions

STAY IN PLAN

Future contributions not permitted.

ROLL OVER TO IRA

Future contributions allowed.

ROLL OVER TO NEW EMPLOYER'S PLAN

Future contributions allowed.

CASH OUT

Future investing would require opening an IRA or taxable account.

Expenses and Services

STAY IN PLAN

Compare the fees, expenses, and services associated with each option including staying in plan, rolling over to an IRA, or rolling over to your new employer's plan.

ROLL OVER TO IRA

Compare the fees, expenses, and services associated with each option including staying in plan, rolling over to an IRA, or rolling over to your new employer's plan.

ROLL OVER TO NEW EMPLOYER'S PLAN

Compare the fees, expenses, and services associated with each option including staying in plan, rolling over to an IRA, or rolling over to your new employer's plan.

CASH OUT

May be subject to taxes and penalties.

Asset Protection

STAY IN PLAN

Plan assets are generally protected from judgement creditors. State laws, which vary, may provide protection (sometimes up to a limit) for IRA assets.

ROLL OVER TO IRA

Plan assets are generally protected from judgement creditors. State laws, which vary, may provide protection (sometimes up to a limit) for IRA assets.

ROLL OVER TO NEW EMPLOYER'S PLAN

Plan assets are generally protected from judgement creditors. State laws, which vary, may provide protection (sometimes up to a limit) for IRA assets.

CASH OUT

N/A

Ready to Roll Over Your 401(k)? Call Us at 1-800-267-1395

We make it easy by working directly with your current provider to handle all of the paperwork.