Written By: Alex Hammersley, Financial Advisor

Are you a participant in a qualified retirement plan? If so, I want to tell you about the benefits of rolling over your retirement money into an Individual Retirement Account (IRA). 

If your employer offers them, qualified retirement plans are a great way to save for retirement. They include 401(k), 403(b), traditional pension plans, and profit-sharing plans. The qualified retirement plan is an even more attractive retirement account when your employer matches your contributions. However, once you become eligible to roll over your retirement funds, it is likely beneficial to get into an IRA as soon as possible. Below are reasons why rolling your retirement plan into an IRA is beneficial for you and your financial plan:

• More investment options: your retirement plan has limited investment options. Unfortunately, of the limited investment options, there are likely only a handful of funds that are worth putting your money into. If you roll your retirement money into an IRA, you can invest in stocks, bonds, ETFs, mutual funds, and the list goes on. Investing in the right products can drastically change the course of your retirement. Be proactive and make sure your money is positioned in the best way possible. 
• Lower fees: your retirement plan may have an AUM fee (a yearly fee based on total assets), AND the funds you put your money into have fees. So, likely you are paying more than just the AUM fee. By rolling your retirement plan into an IRA, you will most likely pay less in fees. We can help compare our fee to your retirement plan’s fee(s) and help you make the right choice.
• Opportunity for Roth conversions: if you roll your retirement money into an IRA, you will immediately have the flexibility to do Roth conversions to get your money tax-free. 
• Allows any qualified retirement plans to be added: you can roll multiple qualified retirement plans into your IRA account. Getting into an IRA will give you the benefit of consolidating your money. 

At age 59 ½, you may roll your retirement money into an IRA. If you want to roll your money over earlier, you can take advantage of the IRS rule of 55 which allows you to roll over your retirement plan starting at age 55 if you also quit working. I suggest contacting us at 844-227-5766 if you have questions on early withdrawal or early rollover of a qualified retirement plan.  

Here at Carlson Financial, all of our advisors are equipped and ready to help you determine if a qualified retirement plan rollover is right for you. Contact us today so we can help you retire well.

Say What?

Buffalo Bills safety Jordan Poyer joined the team in 2017 but is now a pending free agent. He says he “would love to go to a state that doesn’t take half of my money.” In 2022, New York had the highest tax burden in the country at 12.75 percent. 

This week in history

1872 – Yellowstone National Park was established in March 1872. (But Yellowstone, the TV drama will only turn 5 this year.)

1876 – Alexander Graham Bell patents the telephone. 

1969 – Pontiac Firebird Trans Am was released. 

If you have any questions, we’d love to chat! Call us at 844-CARLSON (844-227-5766) today!