kastnna <kastnna@[EMAIL PROTECTED]
> writes:
[Doing 401k rollover to IRA]
> POTENTIAL advantages:
> 1. Hassle of dealing with former employer and it's administrators.
Don't underestimate this. The OP indicated that the 401k *plan*
is with a major financial institution. That doesn't make much
difference if the former employer is not - you still have to
track down the employer to do many things. I had a big hassle
tracking down someone able to deal with a 401k from a former
employer which had gone out of business. The 401k provider,
of course, was just fine.
Also, don't forget
8. *clarity* - many 401ks have fees which are not clear or
visible. The funds may be great and have low expenses
at the fund management level, but the plan itself may
still be whacking at you with fees which aren't obvious.
That said, some plans are fabulous. My current one
has is as straightforward and low-cost as could be.
> POTENTIAL disadvantages:
> 1. 401k may allow distributions at 55 without penalty.
If one is on disability or has fully separated from service
to that former employer (which, IIRC, the OP has).
> 2. Institutional investments that may not be available to IRA
> investors.
However, there are very few for which an equally good
equivalent is not available in an IRA.
also,
3. If you have employer stock in that 401k with a big
gain embedded in it, there may be good reason to
make the company stock a taxable distribution,
since it may be treated differently tax-wise. Talk
to an accountant. Google for "Net Unrealized Appreciation"
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