IRA and 401(k) both are retirement funds that ensure you have sufficient money when you no longer work. I though this would be a good followup post after yesterday’s post on IRA Vs. 401 (k).
Do you know that in 2010, 11 Million 401 (k) to IRA rollover conversions happened? We do not have data published yet for 2011. But, the highlight is that almost twice the number of people should have rolled over had there been enough help and advice available at their finger tips.
Financial Literacy in this country is still not enough. There is a lack of concerted effort in educating people on managing personal finances.
Recently I have come across FiPath’s Express Rollover Recommendation tool, while researching for IRA Vs 401(k) roll over options. This is perhaps the only tool/help/guide available in the marketplace today that can guide you in your IRA rollover process.
If money is sitting in your previous employer’s 401 (k), you would do a ton of good to get it rolled over to IRA, as you will have a freedom of choice. You can micro manage your retirement fund the way you think best suited to you. You will not be limited to a few target date funds, and you will also lower your overall investment costs.
Reasons why a consumer needs to do a 401k-to-IRA rollover
o Lower cost. As recent fee disclosure requirements are making obvious, 401 (k) ‘s are not the lowest cost investment vehicle many assume—depending on the employer, a consumer may pay hundreds of dollars a year in management and custodial fees for keeping their money in an ex-employer’s 401k plan.
o More choice. Money in a 401k plan can only be invested in employer-selected investment funds; your IRA can invest in almost anything. With an IRA, the consumer has full control of their money.
Because of the lower fees and broader choices that an IRA enables, money invested through an IRA will typically grow at a higher rate of return—this could mean tens of thousands of dollars more in an IRA savings account upon retirement
Why to use the FiPath Express Rollover Center?
Because this is the only tool of its kind in the industry. No other product enables the consumer to compare multiple options, based on their own interests and criteria, to select the perfect rollover solution for them.
The FiPath Express Rollover Center is comprehensive, informative and easy to use. Within a few minutes a consumer can find the right option for them— saving hours of tedious research
Specific features of the Express Rollover Center
1. Expert Advisor Access. Not all consumers want to manage the 401k rollover process on their own. For them, FiPathcreated the option to search through a universe of financial advisors chosen specifically for their expertise in helping consumers handle a 401k rollover.
2. All advisors are presented based on distance to a consumer’s zip code. Consumers can reach out to up to 5 advisors, via phone or email. You can chose with whom you wish to work. All advisors are screened for their expertise.
3. You are in complete control at all times – You can select who you want to work with or whether you want to work with anyone. If a you decide not to work with an advisor, you can terminate the relationship anytime.
4. If you want to go cheaper, FiPath offers the ability to find a brokerage or mutual fund firm to work with directly.
5. FiPath allows you to search based on your interests to find the firm that best meets your needs. All firms are presented based on average annual trading costs, from lowest to highest.
6. Rollover firms are compared apples-to-apples on relevant metrics – cost, products offered, annual fees, account minimums, etc. You can easily compare the recommendation based on “FiPath Score”, which compiles scores from multiple industry sources (JD Power, Barrons, etc) as well as FiPath’s own evaluation of each firm’s offering
Some firms are highlighted as best for specific types of investors – “First Time Investors”, for instance, or “Active Traders”. This is based on FiPath’s independent evaluation of each firm’s offering. When a firm makes a specific offer for new accounts, FiPath has included that too so the consumer can always get the best deal.
Who are FiPath
FiPath is a venture-backed startup with the goal of helping Generation X and Y achieve their financial goals. Founded in 2008, the firm has a community of more than 90,000 users who turn to it for tools, information and advice on how to connect with their financial future. Read for more information on FiPath.
We found the product effective and believe that it can be a great help to your rollover needs.
| SB is a husband and working as a software professional for a Fortune 100 corporation in Florida. Thanks for visiting the blog.
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I’m trying to get my husband to rollover his 401 k right now. it’s such a pain in the butt even though it really doesn’t require a ton of effort. this product looks like it may be helpful.
Don’t lose the battle, keep on inspiring him.
Yes, it’s always a great idea to roll over a 401K from your last job to an IRA. You explained the benefits beautifully. I’ve never heard of Fipath. I need to look into it. Thanks so much for sharing this post.
Great go ahead and leave a comment about your experience here.
Great post! IRA and 401(k) both are retirement funds that ensure you have sufficient money when you no longer work. This is a very good tip especially to those new to the blogosphere. Simple but very accurate info… Thank you for sharing this one. A must read article!