If you’ve been a government employee or worked for a tax-exempt organization, transitioning to a private company can be an exciting opportunity for growth and advancement. But what about your hard-earned retirement savings? If you’ve been diligent in contributing to your 403(b) account through your last employer, you may be wondering what your next steps should be.
Luckily, you have options. One option is to leave your 403(b) account where it is. After all, if you’re happy with the fees and the performance of your current plan, there’s no immediate need for change.
However, there are several reasons why you may want to consider rolling over your 403(b) to an IRA. First and foremost, an IRA can offer more investment options than your current 403(b) plan. With a wider range of choices, you have greater potential to grow your savings.
Additionally, depending on your new employer’s retirement plan, your 403(b) may not even be an option to contribute to. Rolling over to an IRA ensures that your savings continue to grow and work for you until you’re ready to use them.
Let’s not forget about simplicity and ease of management. Combining multiple retirement accounts into one IRA can make keeping track of your savings a breeze.
But don’t just take our word for it. Research and compare your options to determine what is best for your unique situation. At the end of the day, the most important thing is securing your financial future so that you can enjoy the retirement you deserve.
#1 Simplify your retirement planning
Consolidating multiple retirement accounts into one IRA simplifies the process of monitoring and managing your retirement portfolio.
Investment fees are lower.
When considering rolling over a 403(b) plan into an IRA, it is important to compare the overall costs of each plan and consider the long-term costs. IRAs generally have lower investment fees than 401(k) or 403(b) plans, but fee structures can vary between plans.
There are additional investment options available.
IRAs typically provide greater investment choices than 403(b) plans, as the latter does not permit the purchase of individual stocks, precious metals such as gold or silver, or investments in a REIT (Real Estate Investment Trust).
Custodians commonly manage traditional IRAs, yet individuals may opt for a self-directed IRA to have more authority over their accounts and more adaptable options.
An SDIRA allows for diversification of assets including stocks, real estate, precious metals, and even cryptocurrency, which may be advantageous for those with an existing 401(k) plan.
Tax advantages are another important consideration when rolling over a 403(b) plan to an IRA. Traditional IRAs allow you to deduct your contributions from your taxes, while a Roth IRA allows post-tax contributions and tax-free withdrawals during retirement. Depending on your current income and anticipated future earnings, one of these types of accounts may be more beneficial for you than the other.
Another benefit of rolling over to an IRA is that you may be able to leverage loans or other borrowing options. Many employers do not offer the ability to borrow from a 403(b) plan and those that do have stringent requirements and limits. However, IRA custodians often allow borrowers to take out loans against their account values at competitive interest rates. Additionally, some custodians may even offer additional benefits like check-writing privileges.
Protect your IRA from a recession with precious metals
Economic downturns can be devastating for retirement plans, but there’s a tried and true way to safeguard your nest egg – precious metals.
While stocks and bonds may be volatile, gold and silver have long been a reliable hedge against inflation and market instability. It’s an investment that’s stood the test of time and has proven to be a safe haven when other assets falter.
Think of it as an insurance policy for your retirement savings. By diversifying your portfolio with precious metals, you’re taking proactive steps to ensure that you’re protected against the next recession.
When deciding on the best way to protect your IRA from a market downturn, it’s important to consider the tax implications of investing in precious metals. Depending on the IRA custodian you select, there may be certain restrictions on what types of gold and silver can be purchased. Some custodians may also require payment of taxes when transferring or selling these assets. Be sure to research each custodian.
In these uncertain times, you can’t afford to take chances with your financial future. Seize the opportunities and safety that precious metals can provide – and rest easy knowing that you’re protected no matter what turbulence lies ahead.