Roll-Overs

Everyone should pay close attention to what I’m about to say. This is considered a complex maneuver in the financial industry—although it’s quite simple as long as you deal with experts. This is called a roll-over.
To start, many people, nowadays, will work for 4-5 different employers throughout their working career. Moreover, it’s a good idea to invest in a 401K. 401Ks are employer-provided tax-deferred retirement accounts in which the employer usually matches the employee’s paycheck contributions to a stated percentage each pay period.
Now, I’m currently doing a roll-over myself. When you leave a job and want to keep directly managing your 401K, and don’t want to leave it under the financial management of your former company’s financial institution, then you want to do a roll-over. Company-provided retirement plans can be seamlessly rolled-over into tax-deferred plans. 

Update

My rollover with through without a hitch. -Derrick Mills, 07/22/2018

1) Roth IRAs are tax-advantaged plans. So, you pay taxes on the money going into the plan. The benefit is when you withdraw the money later when you retire—if you use the plan as it’s intended—you won’t have to pay taxes. I personally have one of these. The purpose of getting a Roth IRA is that we don’t know how high the tax rate will be when we retire. So, we’re paying taxes now while we’re working so that we won’t have to pay taxes later when we retire.
2) Traditional IRAs are tax-deferred plans. So, the money that you invest into these aren’t taxed upon investing. You pay taxes on this later when you pull the money out once you retire. The purpose of this plan is to maximize the growth of your money. Untaxed dollars are more than taxed dollars. I recently opened a Traditional IRA for the purpose of rolling-over my 401K.
3) For those in the military, the Thrift Savings Plan is just a military version of a 401K. So, it works the same and is under the same rules.
4) Pensions--which are being phased out—are tax-deferred—unless your pension is the result of a disability or is a military pension. You and your company both place money into your pension. Your company places a certain percentage of money in your pension based on your time with the company. The percentage amount the company puts into your pension increases over time. The plans pay until you die. If you’re married, it’ll pay your spouse until he/she dies as well. Pensions, also, never decrease in value as long as you’re not drawing from it. All of the investments I’ve listed up to now can lose money. However, employers take the money that you placed into your pension and invest it. If their investments make money, then they make money. If their investments lose money, then they lose money. Regardless, the employer continues to contribute a certain percentage to your pension. From talking to a friend of mine, many pensions, nowadays, aren’t allowing you to change your designated beneficiaries because these plans are grandfathered. In other words, since they’re no longer offered, if you want to change them, then you’ll have to switch over to a 401K plan.
5) Annuities work very similar to pensions. However, they aren’t offered by companies. Just like with IRAs and Roth IRAs, you take-out your own annuity. You make the initial investment, and you can continue to contribute to it to further help it grow. Moreover, as long as you don’t take-out more than the allowed amount, you won’t be penalized. However, to truly enjoy an annuity, one has to treat it like a retirement account. Just like a pension, it pays until you die. If you’re married, then it’ll pay your spouse until he/she dies as well. However, you can change your beneficiary as you see fit. Also, provided that there’s still some money left in the annuity, it provides a death benefit. Annuities, also, never lose money. Annuities fall under insurance. So, they make money up to a stated maximum percentage when the market does well. If the market does poorly, annuities don’t lose money. The only exception is variable annuities—which are securities. They make money as high as the market rate. So, they can lose money as low as the market rate. Finally, once you reach retirement age, and begin withdrawing from it, you’ll pay taxes. Annuities are tax-deferred.
Anyway, now that you know of these different alternative investment vehicles, if you have a 401K—and you’re leaving your company, you now know what vehicles you can roll your money into. -Derrick Mills, 05/09/2018

(If you enjoyed this post, then please consider subscribing to stay up-to-date with my latest postings and sharings. Also, please share and support Worldly Game.)