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Retirement Account Rollover

Maryland’s 401(k) Rollover Professionals

Likely, you’ll have multiple jobs with different employers before settling down in retirement. Because of that, you’ll also likely contribute to multiple retirement accounts—as each company will set up a 401(k) or similar account under their plan and benefits.

The trouble is, having multiple retirement accounts across former employers can be confusing and hard to monitor. Furthermore, you may miss opportunities for compounded growth on collective retirement assets if they are held in multiple accounts, as well as the benefit of ensuring a consistent strategy. The solution for this is to consolidate these multiple accounts into one Individual Retirement Account (IRA) that can be easily tracked, monitored, and managed. Specifically, this should be a Traditional IRA because of the pre-tax contributions that may have been contributed to your 401(k).

The advisors at Geier Asset Management can help you with retirement account rollover and retirement planning to ensure that your financial future remains bright. Learn more about the 401(k) rollover process or call us at (410) 824-1853 to speak with a professional!

Direct Rollover/Trustee-to-Trustee Transfer

To avoid any tax consequences, we recommend establishing a trustee-to-trustee transfer, also known as a direct rollover. In this process, you first establish an IRA and then give instruction to your former employer’s retirement plan to directly deposit assets into this established account. This is the optimal way so that all funds are transferred directly.

A mistake individuals often make is to request the funds be issued to them rather than the account, whereby their former employer is required to withhold 20% of the balance. Put simply, this delays the process of effectively transferring all the assets. Also, if you fail to deposit these funds into an IRA within 60 days, it becomes a taxable distribution that is subject to ordinary income tax and potentially a 10% penalty.

For this reason, we almost always recommend a direct rollover to an established Traditional IRA. To talk to our 401(k) rollover experts about putting a direct rollover in place, contact us online.

The Importance of Rolling Your 401(k) to a Traditional IRA

The benefits of rolling a 401(k) to a Traditional IRA can be tremendous. The first benefit is that you are no longer limited in your investment selection and may be able to pick the optimal allocation for your investment objectives and goals. The other benefit is you can continue to contribute to this account through annual contributions while you are employed or you may roll over other 401(k)s into this account.

As mentioned above, with all your retirement accounts rolled into one account, you not only can manage your allocation more effectively, you can also amplify the benefits of dividends and interest earned via compounding growth.

To learn how the experts at Geier Asset Management can help you roll over your retirement account into a Traditional IRA, call us today at (410) 824-1853.

Is Rolling Over to an IRA My Only Option?

While this is definitely the most common method, there are other options available. Some choose to take an immediate lump sum (cash-out), while others choose to leave the assets in the former employer’s plan or moving them into their new employer’s plan. The rationale for each is different and the tax and investment implications should be understood completely before taking action.

How to Rollover Your 401k

Frequently Asked Questions

Will I owe taxes on my rollover?

No taxes are owed on a direct rollover from like registered accounts. Also, no taxes are incurred on a direct rollover from a retirement plan (401(k), 403(b), 457) to an IRA. Taxes are only owed if a “distribution” from a retirement plan occurs.

What happens if I already took the cash from my account? Can I still roll over to an IRA or to a new plan?

If a cash distribution from an IRA or 401(k) has taken place, you have 60 days to place into another IRA or 401(k) plan. Otherwise, taxes and penalties (if applicable) will be owed.

Can I move my assets from one type of plan to another, for example, from a 403(B) to a 401(k)?

Yes, assets can be transferred between retirement plans such as a 403(b) into a 401(k).

For more frequently asked questions, check out our 401(k) rollover guide.

Retirement Planning with Geier Asset Management

It’s imperative that you take the time to review all of your retirement accounts and ensure they are managed as efficiently as possible. Our advisors at Geier Asset Management can help you with this process and enable you to do what is necessary to maximize the potential of your accounts. At Geier, we have offices in Florida and Maryland, focusing on the Columbia, Baltimore, and Ellicott City area, but we can help anyone nationwide look toward and plan for their best retirement. Contact us to learn more about our retirement planning services.

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