Does the return of spring inspire you to dust off, declutter and simplify your life? One way you can make your financial life a little simpler is to roll over any eligible accounts from previous jobs into your current retirement plan account. By consolidating accounts, you can invest the funds from other accounts in your existing investment options or any other investment options your current plan offers. You can also:
- Apply a consistent strategy across all your retirement assets – Instead of trying to recreate your asset allocation and diversification strategy for multiple accounts, you can apply one strategy to all your retirement assets.1
- Simplify tasks like portfolio rebalancing and required minimum distributions – When you consolidate, you only need to perform account management tasks once. So, if you need to rebalance your portfolio or calculate an RMD, you don’t need to do it multiple times for multiple accounts.
- Access one website and review one statement – Tired of keeping track of multiple user IDs and passwords and filing away multiple statements? Account consolidation can make things easier.
- Make things easier for your beneficiaries – In the event of your death, your beneficiaries will only have one account to deal with when settling your estate.
Keep in mind that not all accounts can be rolled into your current retirement account. The IRS has a rollover chart that shows which types of accounts can be consolidated. Also, you’ll want to compare the administrative and investment fees that your different accounts charge before you decide to consolidate. Consider all your options and their features and fees before moving money between accounts. You can contact your local plan representative with any questions you may have about the process.
1 Asset allocation, diversification, dollar‐cost averaging and/or rebalancing do not ensure a profit or protect against loss.