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The Rollover IRA

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420x316-grad-lee Dee Lee
Dee Lee is a Certified Financial Planner who received a diploma in...
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BOSTON (CBS) – Rollover IRAs are set up to receive distributions from qualified retirement plans such as your 401(k), 403(b), 457, or another IRA. You “roll” the money from one account into another.

The Rollover IRA

fidelityinvestments The Rollover IRA
WBZ NewsRadio 1030

If you are in between jobs, it can become a holding place for your retirement money until you decide if you want to transfer the money into your new employer’s plan.

There is no time limit on money held in a rollover IRA. If your new employer does not allow transfers, no sweat! If you change jobs again and the newest employer allows transfers, you can roll it then.

You do not want to “contaminate” the dollars in the Rollover IRA by making a regular IRA contribution to the account. Doing so prevents your ability to rollover that account into a new employer’s retirement plan.

As a general rule of thumb, when you leave a job you are usually better off rolling most employer plans into an IRA and leaving them there. You will have greater flexibility and certainly more choices. The one thing you will not have is the ability to borrow from the IRA as you do from some employer plans and if you rollover a 457 plan you lose the ability to start early distributions.

You can at any time move your IRA account to a different plan provider if you are not happy with your current choices. I would strongly suggest setting up a brokerage IRA so you have some flexibility as to the types of investments available to you.

I would suggest a financial supermarket-type company like Fidelity that allows you a broad range of choices, stocks, bonds, money market and checking accounts, their own mutual funds, as well as mutual funds from different companies.

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On Saturday May 17th Dee will be the keynote speaker at The Money Conference which is a FREE one-day event presented by The Office of Massachusetts State Treasury and the Massachusetts Financial Literacy Trust Fund, in conjunction with local cities and community partners to help households build their financial knowledge and improve their financial behavior through quality financial education.

The Money Conference: Financial Empowerment for Individuals & Families

Saturday May 17, 2014
8:30 am – 3:00 pm

Everett High School
100 Elm Street
Everett, MA 02149

Questions? Contact Sheila O’Loughlin at (617) 367-6900.

Do you feel your need for financial education and empowerment is urgent? You are not alone! Americans are saving less, spending more and carrying credit card debt over from month-to-month, suggesting that the painful financial lessons of the recent past may quickly be forgotten.

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