When it comes to saving for retirement, it’s important to work smarter, not harder.
For example, strategically rolling over funds across your retirement account could help you supercharge your savings. And since retirement costs can add up faster than you might expect, every little bit helps when saving for your golden years.
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This guide explores some of the best strategic retirement rollovers that could help you make the most of your retirement savings.
It’s common to move across multiple jobs during your working years. Many opt to jump to a new job in pursuit of a higher salary. Even though making the move to a new employer can be a good thing for your income, you might leave with a modest amount in your previous employer’s 401(k) plan.
Unfortunately, it’s common to forget about these accounts. In fact, $1.7 trillion sits lost in forgotten 401(k) accounts, according to the North Carolina Financial Literacy Council.
If you’ve lost or forgotten about a 401(k) account from an old job, it’s critical to find that money. Typically, you’ll be able to track down a lost account by getting in touch with your previous employer’s Human Resources department. From there, it’s often as easy as following a trail of paperwork to recover the account.
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For anyone thinking it might not be worth the hassle, it’s worth noting that a seemingly small amount of retirement savings can make a big difference to your future golden years. For example, let’s say you recently turned 35 and are ready to get on top of your finances. You remember having a 401(k) account at a previous employer, which you discovered held $7,000. After taking action to roll over these funds into your current 401(k) plan and managing it for 30 years with a 8% annual return on your investment, it could be worth around $70,000 when you retire at 65. That’s definitely worth finding!
Planning for retirement is hard enough. But it’s even more difficult when you have a string of old 401(k) accounts from previous employers to keep track of. Luckily, it’s usually easy enough to roll over your old 401(k) plan into a new employer’s 401(k) account.
If you like the new employer’s investment options and fee structure, making the rollover could help simplify your finances and provide a smooth path to saving for retirement.
