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401K Rollover

What You Need to Know about 401(k) Rollovers

Most employees switch jobs multiple times throughout their career. When you work for a new employer, you have to decide what to do with your 401(k) at your previous job. Typically, the best option is to rollover the funds into your new employer’s 401(k) or into an IRA. You have to follow the IRS rules to protect yourself from having to pay taxes and penalties. Our investment advisors at Retirement Concepts of America are here to help you with the rollover process.

<span style="font-weight: 400;" data-mce-style="font-weight: 400;">What Are Your Options for Your 401(k)?</span>

What Are Your Options for Your 401(k)?

With your current 401(k), you have multiple options available to you. You can choose to receive the funds in cash and spend them however you want. However, unless you’re retirement age, you’ll likely pay a 10% early withdrawal penalty and taxes on the income. Another option is to leave the 401(k) with the previous employer. There will be restrictions on what you can do with it, and you can no longer make contributions. 

Your best options are to use the 401(k) rollover rules to rollover the funds into another 401(k) or IRA. If your new employer offers a 401(k) that allows rollovers, it’s an option worth exploring. However, you may find you have more investment options with an IRA. An IRA also gives you the option to keep all of your assets under the same roof. Our financial advisors can help you understand the different options with each.

<span style="font-weight: 400;" data-mce-style="font-weight: 400;">How 401(k) Rollovers Work</span>

How 401(k) Rollovers Work

There’s a time limit for rolling over your 401(k). After you have received the funds from your previous 401(k), you have 60 days to deposit the money into a qualified retirement account to avoid penalties and taxation. With an indirect rollover, you may only receive 80% of your 401(k), but you need to reinvest the entire balance to avoid taxes and penalties.

You can only rollover your retirement account once a year, but there’s no limit on how much money you can rollover. We can help you make this process go as smoothly as possible by utilizing a direct rollover from your previous 401(k) to your new retirement account. With a direct rollover, we transfer the funds from your current 401(k) to an IRA. We’ll help you select the best investment funds within that IRA.

<span style="font-weight: 400;" data-mce-style="font-weight: 400;">Advantages of 401(k) Rollovers</span>

Advantages of 401(k) Rollovers

There are several advantages to rolling over your retirement assets into an IRA. An IRA provides you with more flexibility regarding your investment options. It’s easier to manage all of your assets under one roof, which reduces the cost of asset management. Finally, if you follow the IRS rules about 401(k) or 403(b) rollovers, you don’t have to pay taxes or penalties. Our financial advisors can help you understand your rollover options and help you take advantage of the tax savings.

FAQs about 401(k) Rollovers

What Are the Pros & Cons of 401(k) Rollovers?

The benefits of rolling over your 401(k) include more investment flexibility, the ability to manage your assets with one account, and the continued option to contribute to your retirement funds. Taxes and penalties are the cons of cashing out your retirement account. The cons of leaving the 401(k) with your previous employer include restrictions on investments and the inability to contribute.

Does My Rollover Count As a Contribution?

No. Your rollover is a separate calculation and does not count as a contribution toward your retirement fund. IRA contribution limits differ from 401(k) contribution limits. How much you can contribute to an IRA depends on your annual income. 

Is There a Limit to How Much I Can Rollover?

No, there are no limits as to the amount you can rollover from your 401(k). However, you can only rollover those retirement funds once per calendar year. There are also other requirements you must meet to prevent taxes and penalties.

Let’s Talk about Your 401(k) Rollover

Our team of financial advisors can help you with your 401(k) rollovers. Let’s discuss your investment option to see if your assets can work even harder in the hands of Retirement Concepts of America. We’ll explain the pros and cons and the process to help you choose the best option. Call us today to schedule an appointment.

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Why Benefits Matter

Benefits are important to employees, and they're important to you company's bottom line too. The Aflac WorkForces Report found that employer-offered benefits are a strong differentiator when it comes to attracting employees, retaining them and protecting thier well-being. 


Improving benefits ranks second (after increasing pay) as a way to retain employees... 34% say this would help keep them in thier job.

A strong majority of employees (85%) see a growing need for supplemental insurance benefits. 

Over half of employees surveyed (55%) would be at least somewhat likely to accept a job with lower compensations but more robust benefits package. 


1 in 5 employees couldn't go more than one week without a paychek; 44% couldn't go more than three weeks. 



The 2018 Alfac WorkForces Report is the eighth annual study examining benefits trends and attitudes. Conducted by Lightspeed, the study captured responses from 2,000 employees across the United States in various industries. Visit

This article is for informational purposes only and not intended to be a solicitation. Aflac individual coverage is underwritten by American Family Life Assurance Company of Columbus or American Family Life Assurance Company of New York. 

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