Rollovers

What is a Rollover?
A rollover occurs when you move your money from a qualified retirement plan, such as an employer-sponsored 401(k) plan, into a Traditional IRA or another qualified retirement plan. Typically, you are eligible for a rollover only under the following circumstances:
  • Retiring. You’ve been saving for years and years...and now it’s finally time to enjoy your hard-earned savings. Many people find that consolidating their retirement assets into a Traditional IRA makes it easier to manage and monitor their money.
  • Changing jobs. When people change jobs, they often have money in a qualified retirement plan sponsored by their employer. A rollover lets them move this money into a Traditional IRA of their own choosing.
  • Between jobs or switching careers. Perhaps you’re taking advantage of opportunities to explore a new profession. Or maybe you’re simply spending time away from the work force to raise a family or go back to school. Whatever your situation, you may wish to simplify your finances by transferring the money from a previous employer’s plan to a Traditional IRA.
Why should you consider a Rollover?
  • Compare your options
  • Expand your investment selection. The wide range of choices for a Traditional IRA, for example, provides investment flexibility to diversify your financial approach.
  • Adapt to new circumstances. A rollover is one way to adjust your investment mix to reflect changes in your investment goals, time frame, or performance expectations. And there is no limit to the amount of money that may be rolled into a qualified retirement account.
  • Stay open to future possibilities. With a rollover, you may retain the option of moving your money into a future employer’s qualified retirement plan.
  • One provider for multiple financial solutions. A rollover lets you consolidate your savings with your agent, so you can continue working with someone who’s already familiar with your needs.
  • Consolidate and manage your retirement assets. The more accounts you have, the more difficult it is to keep track of your money. Consolidating your assets into a single traditional IRA can make it simpler to track balances and monitor your withdrawals.
Potential Tax Benefits
  • No current income tax. With a rollover, you don't have to immediately pay federal income tax on the amount you've rolled over.
  • No tax on earnings. Your money can potentially grow tax-deferred until you begin to make withdrawals from your account. No tax withholding. You'll avoid the 20% federal withholding for federal income taxes, so the entire balance of your account continues to work for you.*
  • No penalty tax. Your rollover isn't considered a taxable distribution, so it doesn't trigger the 10% penalty tax for early withdrawals made prior to age 59 1/2.