#110 1/2 - ONE MORE pro of rolling over employer plans (like a 401(k)) to an IRA

Retirement Planning Education, with Andy Panko

I'm a buffoon and I missed including another important pro of doing an employer plan-to-IRA rollover in episode #110's list of pros and cons of rollovers. The additional potential pro is the ability to do Qualified Charitable Distributions ("QCDs") out of the IRA if you're at least 70 1/2 and charitably inclined.
So, the recap the full list of pros (including QCDs) and cons of doing an employer plan-to-IRA rollover:
Potential PROS of rolling over an employer plan to an IRA or Roth IRA:

• More investment options
• Likely lower fees and costs
• Access to professional advice
• Better control over tax withholdings
• More withdrawal options
• Less Required Minimum Distributions ("RMDs") to manage
• Less financial clutter
• Gain the ability to do Qualified Charitable Distributions ("QCD")

Potential CONS of rolling over an employer plan to an IRA or Roth IRA:

• May lose the ability to take early distributions without penalty
• May lose the ability to cleanly do backdoor Roth IRA contributions
• May lose the ability to continue to delay RMDs from that plan (if you're still working at that employer)
• Lose the ability to take loans from the money
• May lose the ability to take advantage of Net Unrealized Appreciation ("NUA") of company stock
• May lose access to a stable value or managed income portfolio investment option
• Potentially less creditor protection

Links in this episode:

• Tenon Financial monthly e-newsletter - Retirement Planning Insights
• Facebook group - Retirement Planning Education (formerly Taxes in Retirement)
• YouTube channel - Retirement Planning Education (formerly Retirement Planning Demystified)
• Retirement Planning Education website - www.RetirementPlanningEducation.com

To send Andy questions to be addressed on future Q&A episodes, email [email protected]