When you can, Your Survival Guy wants you to roll over your 401(k) to an IRA Rollover at Fidelity. Here are two reasons why, as explained by Olivia S. Mitchell in The Wall Street Journal:
Rolling over to an IRA
- You’ll likely have more investment options.
One of the primary benefits of rolling over a 401(k) into an IRA is access to a larger menu of investment options. IRAs typically provide more choices than available in a 401(k) plan, including exchange-traded funds. Some ETFs charge relatively low fees, particularly index ETFs, yet relatively few employer-sponsored retirement accounts include these products to date.
In addition, a retiree seeking to buy individual stocks and bonds could do so in an IRA, as 401(k) plans tend to favor mutual funds (some do allow access to individual investments via brokerage accounts). And IRAs can hold “unconventional” assets, including precious metals, physical real estate and hedge funds—investments not typically included in employer-sponsored plans.
- You can streamline your accounts.
People with several 401(k) accounts from past employers can streamline their financial lives by rolling them all into one IRA. This can make it easier to manage your portfolio and track your investments. And you won’t need to dredge up various account numbers and passwords.
It is true that most 401(k) plans allow you to roll retirement savings from past employers into your current 401(k). Still, if you also have money in an IRA, that money will still remain separate.
Streamlining the number of retirement accounts also can simplify finances for your spouse or children, when the time comes for them to help you with important decisions about eldercare, nursing homes and estate management. This also can matter when the time comes for them to deal with your estate. When my own elderly parents died, for instance, it took me an entire year to sort out and consolidate their various (small) financial accounts.
Action Line: When you want to talk about rolling over your 401(k) to Fidelity, I’m here. In the meantime, click here to subscribe to my free monthly Survive & Thrive letter.
