Yes, it is possible to roll over a 401(k) to an IRA while still employed. This involves moving funds from your employer-sponsored 401(k) plan to an Individual Retirement Account (IRA) that you establish. There are two main types of IRA rollovers: direct and indirect. In a direct rollover, the funds are transferred directly from your … Read more
When you contribute to a 401(k) plan, your employer may match your contributions to encourage saving for retirement. However, to ensure that you stay with the company for a certain period, employers often implement a vesting schedule. Vesting refers to the gradual transfer of ownership of the employer’s matching contributions to your account over time. … Read more
Rebalancing your 401k is adjusting the asset allocation to match your risk tolerance and investment goals. It helps maintain the desired level of risk in your portfolio. As your investments grow, the proportion of different assets may change, which can alter the overall risk and return profile of your portfolio. Rebalancing brings it back to … Read more
Retiring at 62 with $400,000 in a 401(k) is possible, but requires careful planning and conservative spending. Assuming a 4% annual withdrawal rate, you could withdraw $16,000 per year, which may or may not be enough to cover your living expenses. To increase your chances of success, consider delaying retirement, maximizing additional income sources, and … Read more
Your Fidelity 401(k) investments are insured by the Pension Benefit Guaranty Corporation (PBGC), a U.S. government agency. This insurance protects your retirement savings up to certain limits, ensuring that you won’t lose everything if your employer goes bankrupt. The PBGC insures most defined-benefit pension plans, which guarantee a specific retirement benefit at a certain age, … Read more
Elective deferral 401k is a retirement savings plan offered by employers where you can choose to contribute a portion of your paycheck before taxes are taken out. This contribution is called a deferral because it’s taken out of your paycheck before you ever see it. The money you contribute grows tax-free until you retire and … Read more
An employer can deny a 401k loan request if they have reason to believe that the employee is not able to repay the loan, or if the loan would put the employee’s retirement savings at risk. Employers may consider factors such as the employee’s income, debt-to-income ratio, and investment goals when making a decision. Employers … Read more
In the United States, both spouses can contribute to their respective 401(k) retirement accounts. Each spouse can contribute up to the annual limit set by the Internal Revenue Service (IRS). This allows couples to maximize their tax-deferred savings. However, it’s important to note that the contribution limits are per person, not per household. So, even … Read more
Vesting refers to the process where you gradually gain ownership of your employer’s contributions to your 401k plan. It’s expressed as a percentage, and it typically starts at 0% when you first start working and increases over time. For example, you may become 20% vested after one year of service, meaning you own 20% of … Read more
If you lose a loved one who had a 401(k) retirement account, you may be wondering if you can inherit it. The answer is yes, but the process can vary depending on the type of 401(k) account and the beneficiary designations. Generally, there are two ways to inherit a 401(k): as a spouse or as … Read more