Should I roll my old 401K over to my new employer’s plan?

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A: If you’ve been at your previous job for a few years, you’ll need to decide what to do with your old 401K plan. If you aren’t careful and make a mistake in the way you handle the account, it could cost you in taxes and penalties, not to mention how it could affect your retirement planning.

 

According to a 2017 SHRM Employee Benefits survey, most organizations offer defined contribution plans to help employees save and plan for retirement. Ninety percent offer a traditional 401K or similar plan, and 55% offer a Roth 401K or similar plan. In addition, 76% of organizations provided an employer match for their 401K plans, while 40% matched Roth 401K contributions.

The one rule experts agree upon is this: Do not cash out your 401K.  It’s simply not worth the financial hit you will take in fees, taxes and penalties.

Here are a few better options to consider:

Leave it with old employer: Do your research into whether the old plan is that much better than a new plan being offered by the new company. Weigh the benefits of staying put.

Roll it into the new company’s 401K plan: According to experts, most mistakenly believe they will incur penalties if they opt for this. That is not the case. But before automatically rolling your existing 401K into your new plan, do the research and compare.

Roll into an IRA: Experts say IRAs can be a way for individuals to take greater control of their retirement plans. Consider getting professional advice regarding whether this is the best course of action to meet your retirement goals.

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The primary purpose of this position is to assist Midwest Community Federal Credit Union by delivering outstanding service to both internal and external members. A key element of excellent service is to identify the financial needs of each member and recommend an appropriate credit union solution. In addition, receives members in person and by telephone. Helps Member Investors reach financial goals utilizing our consultative sales process. In addition, responsible for ensuring that outstanding service is delivered to both internal and external members. A key component of this service is to provide proactive guidance on investment solutions via a needs-based consultative selling approach to both current and prospective Members who have placed an inbound call or referral to the Investment Representative.

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Midwest Community Federal Credit Union is looking for a Member Service Representative to process transactions, accurately perform end of day balancing procedures, follow company policies and utilize the core data processing system and various software applications, including electronic banking services. We are seeking candidates who are punctual, honest, friendly, and have outstanding communication skills. Please see the job description for a full list of duties. Resumes may be submitted to Sondra Manon at smanon@midcomm.org.

Midwest Community Federal Credit Union is an Equal Opportunity Employer.

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