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In 1982 in the early stages of the “British Invasion” a rock band, known as The Clash, had an album that peaked at number seven on the U.S. music charts.
Two of the songs from that album are, “Rock the Casbah” and “Should I Stay or Should I Go.” The latter’s lyrics began with;
Darling you got to let me know
Should I stay or should I go?
If you say that you are mine
I’ll be here til the end of time
So you got to let me know
Should I stay or should I go?
It was a catchy tune. With the first lyric being “Darling” we assume the person in question is someone special in their life, precious maybe, someone they value, but they’re not quite sure of the relationship and they desire confirmation. Now instead of a person think of “Darling” as money you have in your old 401(k) plan.
Drive down almost any street in the US with billboards and you’re sure to see an ad that states “Did you leave a 401(k) at an old employer? Come in and we can help you move it to an IRA. Now ask yourself: Should I Stay or Should I Go….
Should I Stay?
As a fiduciary Financial Advisor I would ask you several questions.
- What are the fees and expenses of your current plan? (Depending on the plan structure, the size of the plan and other variables the costs can differ).
- Would you incur a higher fee structure if you were to move the investments to your current 401(k) plan, IRAs or Roth IRAs vs staying where you are?
- What are your current investment selections within the plan? Do those selections compliment your retirement objectives? Are you in the need to re-balance and can that be done within the current plan?
- Could there be legal ramifications in moving the funds? Laws can vary from state to state, but employer-sponsored plans usually have a higher degree of protection from creditors and legal matters compared to IRAs.
Should I Go?
Your current sponsored plan may allow you to roll funds from an old plan. Your current plan may offer a better choice of investments and may have a larger group of investors which may reduce costs. (Think fees). Your rolled account will be kept separate from the funds in the new plan. Your rolled funds will always be available to you. (Normal IRS regulations would apply and subject to early withdraw penalties).
If you roll your 401(k) into an IRA or a Roth IRA account (there are no tax consequences if done properly) then there are literally thousands of domestic, foreign and emerging market stocks, mutual funds and ETFs to choose from. (Employer-sponsored plans have limited investment choices).
As a fiduciary, my job is to put your needs first, to treat your money like it was my money if I were in your same situation. With a complete understanding of who you are and what’s important to you an Advisor can make the proper recommendations that will set you on the best course for your retirement.
I can go on and on with why you should leave the money in the old plan AND why you should move it. Like all investing, each client is unique and no one strategy is correct for everyone. The point I’m trying to make is, it’s not that simple and don’t let anyone tell you it is!
Is the money that you’ve worked hard for, no matter where it’s held, precious to you? Does it have value for your future? Do you need to make a decision?
Call us we can help!
The Clash was one of numerous British groups that stormed their ways to our shores throughout the 1980s. Some people liked them, others didn’t. Who would have thought that the opening lines in one of their songs could be used in the world of finance!
Disclaimer: Do not construe anything written in this post or this blog in its entirety as a recommendation, research, or an offer to buy or sell any securities. Everything in this post is meant for educational and entertainment purposes only. I or my affiliates may hold positions in securities mentioned in the blog. Please see my Disclosure page for full disclaimer.[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column offset=”vc_hidden-lg vc_hidden-md vc_hidden-sm”][vc_widget_sidebar sidebar_id=”sidebar-main”][/vc_column][/vc_row]
