Should I Roll Over My Dormant 401(k)?

401(k)s and IRAs have many unique features that may be beneficial to your client, depending on their circumstances. The decision to roll funds out of a former employer’s plan involves more factors than just fees and investment selection.

To help make this analysis easier, we have created the “Should I Roll Over My Dormant 401(k)?” flowchart. It addresses some of the most common issues that should be considered before doing a rollover, including:

• Common IRA and 401(k) features and differences
• Net Unrealized Appreciation options
• Age-based distribution options
• Taxes and penalties in an IRA vs. a 401(k)
• Availability/existence of loans and the impact of a rollover
• Hardship Withdrawals
• Substantially Equal Periodic Payments

Updated 7/15/2020 (including The SECURE Act)