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401k Rollover to IRA

Considering a 401(k) Rollover?

A Rollover IRA is a retirement account that allows you to move funds from a 401(k) from a previous employer to an IRA. As a result, the assets in your retirement account remain tax-deferred. We will help you understand the potential considerations of what a 401(k) has to offer, so you can make a more informed decision about what is right for you.

What you should know about a 401(k) rollover

What is a Rollover IRA?
Do you have a 401(k) from a previous employer and want to learn more about a rollover IRA? Watch now.
Should You Rollover an Old 401(k)?
Educate yourself about the factors to consider before making the decision to roll over a 401(k). Watch now
How to Set Up a Rollover IRA
Learn how to roll over your 401(k) from a previous employer in just three simple steps. Watch now.

Helpful resources

Explore these Ticker Tape® articles to help decide if a 401(k) rollover is right for you.

Retirement Plan Rollover Choices

Have you changed jobs or are you planning to retire? The information below can help you decide if consolidating your assets into a TD Ameritrade IRA or 401k may be best for you or call 800-454-9272 to speak with a New Account Representative. You have choices when it comes to managing your old 401(k) retirement assets.

Roll over your old 401k into a TDAmeritrade IRA

Advantages

Your investments will remain tax-deferred until you withdraw them
You will have access to a wide range of investments, including mutual funds, ETFs, stocks, bonds, options and more
You will have access to a wide range of tools, resources, and services
You may have the flexibility to convert to a Roth IRA
You may still have the option to move assets to a future employer's plan later
You may be able to take penalty-free withdrawals prior to 59½ in special circumstances (such as higher education expenses, health insurance premiums or a first-time home purchase)
Your TD Ameritrade IRA will not incur an annual account maintenance fee

Disadvantages

You will not be able to take a loan against your account
Any outstanding plan loan balances would need to be repaid prior to rolling over or you may incur income taxes and potentially a 10% tax penalty
Your investment activity may incur trading-related expenses, including commissions
You may not have access to the exact same investments in an IRA that you had in your plan
The level of protection from creditors for assets in an IRA is lower than in a plan
If you hold appreciated employer stock in your former employer's plan account, there may be tax consequences. You should consult a tax advisor

Leave the assets in your former employer’s plan

Advantages

Your investment plan choices may include low-cost, institutional-class products
Your total costs may be lower than other alternatives
Your investments will remain tax-deferred until you withdraw them
You may be able to take loans against your account
You may not have to take any action or complete additional paperwork
You may be able to take penalty-free withdrawals if you left your old employer between age 55 and 59
Your retirement plan balances may be protected from creditors and legal judgements under federal law
You may still be able to roll over to a future employer's plan later
You would still have access to investor education, guidance and planning provided to plan participants
The investment choices on your plan menu were selected by a plan fiduciary

Disadvantages

Your investment choices would be limited to those in the plan
Your former employer may pass certain plan administration or recordkeeping fees through to you
Even though you would still participate in the plan, you would not be able to contribute any new funds
Managing your investments among multiple accounts can be a lot of work

Roll over the assets into a new employer’s plan

Advantages

Your total costs may be lower than other alternatives
Your investments will remain tax-deferred until you withdraw them
You may be able to take loans against your account
You may be able to take penalty-free withdrawals if you leave your new employer between age 55 and 59
Your retirement plan balances may be protected from creditors and legal judgements under federal law
Your plan investment choices may include low-cost, institutional-class products
You may have access to investor education, guidance and planning that your new employer provides to plan participants
The investment choices on your plan menu were selected by a plan fiduciary
If you roll over to a new employer's plan you may not have to take required minimum distributions (RMDs) if you decide to keep working

Disadvantages

Your investment choices would be limited to those in the plan
Your new employer may pass certain plan administration or recordkeeping fees through to you
You may be required to complete paperwork to have your assets moved over
If you hold appreciated employer stock in your former employer's plan account, there may be tax consequences. You should consult with a tax advisor.

Take a cash distribution

Advantages

Your money (after any taxes and applicable penalties) will be immediately available to you

Disadvantages

Your retirement savings will be depleted
The amount that you cash out will be subject to mandatory 20% withholding for federal taxes if under age 59½
Your distribution will be subject to applicable federal, state and local taxes
You may be subject to a 10% penalty if you under the age 59½

Get in touch Call or visit a branch

Call us: 800-454-9272

175+ Branches Nationwide