When is the best time to roll over your 401(k)?

The days of working for the same employer for 30 years are a thing of the past. According to the Bureau of Labor Statistics, the median number of years dedicated to the same employer is 4.6 years. With the speed of innovation and technology in all types of industries, it is not uncommon, nor frowned upon, to change employers for the sole purpose of keeping your career moving forward.

This frequent change of employment presents a problem when saving for retirement because lingering 401(k), 457(b) and 403(b) plans left behind may become tough to manage, or worse, left on “autopilot”.

You have options when considering what to do with your former 401(k) plans:

  1. You can leave them where they are with the investment options available through your former company’s plan (typically 8 to 15 investment options), or
  2. You can roll them over into a Rollover IRA – multiple former 401(k) accounts can be consolidated into one Individual Retirement Account (IRA).

Opting to keep your old 401(k) account with your former employer may limit your investment options. Consolidating former 401(k) plans into a Rollover IRA increases your investment choices significantly from just a few to several thousand, including a broader variety of mutual funds and ETFs.

But when is the best time to roll over your account? 

The best time to roll over your 401(k), 457(b), or 403(b) account into a Rollover IRA is at a cyclical top or bottom in the market. Specifically, RIGHT NOW is a great time to achieve this since the market is showing potentially longer term weakness that will negatively affect your retirement accounts if left unmanaged. Consolidating them now not only allows you to lock in the gains, but ample time to transfer the account so you will be poised and ready to invest when internal market signals are healthier. Another great time to consolidate your accounts is at a cyclical market bottom. Most likely, it might be a while before we see that again.

Do not be in the dark about your 401(k) options. We can help you consolidate your lingering 401(k) retirement plans into one account, with one monthly statement and we can drastically improve your investment choices. You need an investment professional who manages your account and keeps you out of trouble while maximizing your gains. You worked too hard to let your retirement account fall through the cracks.

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