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Is Rolling Over Your 401k Into an IRA the Right Choice?

One of the perennial questions faced by those planning for their retirement is whether it's better to leave their money in an employer-sponsored 401k plan, or whether they should instead roll over their 401k into an Individual Retirement Account (IRA).

In truth, there is no one right answer here - it depends on a wide variety of factors, including your other investments and your long-term goals. An experienced wealth management advisor from our Napa Wealth Management team can help you understand your options, and which option will be better for you. Although every person’s situation is different, Napa Wealth Management has found that you should consider rolling over your 401(k) when:

  • When You Should Roll Over Your 401k

You want more control. IRAs can be easily customized, with thousands of investment choices. Many of them are free of commissions and transaction fees as well. Many of these are free of commissions or transaction fees as well.

You want fewer fees. In general, IRAs have few associated fees - particularly where management is concerned. However, the potential savings will vary considerably depending on the fees charged by your current 401(k).

You want to consolidate. A single IRA is much easier to manage and oversee than multiple 401k plans. This is often a good choice for those who have changed employers several times.

Napa Wealth Management believes an IRA rollover may not be the right choice when:

You want protection from creditors. In general, IRAs offer far less protection against being seized because of lawsuits or bankruptcy than 401k plans.

You may want to borrow against the 401k. Many 401k plans allow you to take out loans against the funds while you are still actively employed. This is not true of IRAs.

Get The 401k Advice You Need

Napa Wealth Management has the experience and the long-term focus needed to help you make the right decisions about how to handle your retirement funds. Contact us today to schedule a free initial consultation. The firm is not engaged in the practice of law or accounting.

Want a better understanding of what a wealth manager should be doing for you?

Call us today at (707) 252-1343