Saving for retirement is something that many people have high on their priority list. The way people save for retirement can certainly vary a great deal, but one of the most common, and beneficial, ways is to participate in a company-sponsored retirement program, such as a 401(k) plan. Today, most companies typically offer some sort of optional retirement program in which...
Recent studies have found that people are changing jobs frequently these days. In fact, Baby Boomers born between 1957 and 1964, on average, held 11 jobs between the ages of 18 and 441.Younger workers are also changing jobs as a way of advancing in their careers. A byproduct of all this job changing is that there may be a good deal of retirement money left behind at former employers. When someone changes jobs and has been participating in an employer’s 401(k) plan, he/she has to make a decision regarding what to do with their retirement plan distribution. If he/she does nothing, it remains with the employer’s plan. If he/she has changed jobs a few times, that means he/she can potentially have several pots of retirement money spread around in numerous plans. This can be cumbersome when trying to keep track of how much is saved and knowing how each account is performing. While leaving money in a former employer’s plan may be an option, one way to gain more control of those assets is to consolidate the retirement funds into a single individual retirement account (IRA). By rolling over the assets and consolidating them into an IRA you can:
* Develop a simplified strategy for your retirement assets that includes all your savings.
* More easily track your investment performance.
* Potentially reduce the cost of working with multiple companies.
* More easily plan for your retirement income and calculate your required distributions when you retire.
* Simplify your tax reporting.
Of course, in some cases consolidating your retirement assets may not be appropriate, but if it is, you may be able to simplify your retirement planning and gain more control over your assets in the long run through consolidation.
1 Bureau of Labor Statistics, March 2012
This educational, third-party article is provided as a courtesy by Nikesh Parikh (CA Ins. Lic. # 0F79124) CFP®, J.D., LUTCF, RHU®, REBC®, ChFC® Agent, New York Life Insurance Company. Registered Representative offering securities through NYLIFE Securities LLC (member FINRA/ SIPC), a licensed Insurance Agency. Financial Adviser Eagle Strategies LLC, Registered Investment Adviser located at 18528 S. Pioneer Blvd., Suite 201, Artesia, CA90701 at 562-403-7100.
To learn more about the information or topics discussed, please contact Nikesh Parikh at 562-403-7100.
Neither New York Life, nor its agents, provides tax, legal, or accounting advice. Please consult with your professional advisor for tax, legal or accounting advice. 1 Bureau of Labor Statistics, March 2012