News Archive

"Reasons to roll over ... [1] Your plan has high-cost investments.... [2] You have a trail of 401(k) accounts.... [3] You need more bond funds.... [4] You want flexibility for withdrawals.... Stick with the 401(k)? ... [1] You plan to retire early…or late.... [2] You want to invest in a Roth IRA, but you earn too much to contribute.... [3] You worry about the loss of Net Unrealized Appreciation (NUA).... [4] You're worried about lawsuits."  MORE >>

"If deciding what to do with an old 401(k) plan has been on your to-do list for a while, here are the key steps you should take to get it done. [1] Check your account value. [2] Determine whether to stay within the 401(k) confines. [3] Assess the quality of your 401(k) options. [4] Find the right IRA provider. [5] Decide whether to convert your traditional 401(k) assets to Roth. [6] Execute. [7] Determine what to invest in."  MORE >>

"An increasing number of states are establishing state-sponsored retirement savings programs. Like CalSavers, many programs utilize Roth IRAs as the default retirement account for employees. However, unless legislation is passed to amend the IRC, most employees who participate in these programs will face limited portability of their retirement savings."  MORE >>

"28% of rollover investors stayed in cash for at least 12 months, with minimal changes after the first three months following the contribution.... The median job switcher saw a 10% increase in pay, but a 0.7 percentage point DECLINE in their retirement saving rate when they switched employers.... [O]nly an average of 15.3% gained a plan upon job change. while an average of 20% lost access to a plan via work."  MORE >>

"To avoid being a landfill where small balances languish, automatic rollover IRAs -- whether 'traditional' or related to auto-portability -- should be evaluated using ... three criteria. These criteria ensure that individuals aren't charged excessive fees, earn a reasonable rate of return and have access to their money and information to make better financial decisions."  MORE >>

"By 2030, U.S. retail retirement plan rollovers are expected to reach $1.15 trillion ... That would represent a 34% increase from the estimated $855 billion in retail rollovers expected in 2025 and nearly double the $612 billion in retail rollovers in 2020.... The average size of rollovers for people aged 50 to 74 more than doubled since 2007, increasing from $101,400 to an estimated $220,00[.] "  MORE >>

"The Federation of Americans for Consumer Choice [FACC] will appeal a mixed ruling that keeps alive the [DOL's] fleeting attempts to reinterpret fiduciary duty.... [The district court] order vacated specific rollover-related provisions, including the rule allowing a single IRA rollover to be considered the start of an ongoing fiduciary relationship ... [but] did not dismiss the DOL's entire rule." [FACC v. DOL, No. 22-0243 (N.D. Tex. Jul. 9, 2025)]  MORE >>

"Roth conversions are taxed as income. Many of the new tax breaks can be lost if taxpayers push their income up too high ... These include the $6,000 tax break for seniors, the increased SALT deduction and the breaks for tips and overtime."  MORE >>

"Judge Ed Kinkeade ruled ... against sections in Prohibited Transaction Exemption 2020-02 stating that an advisor could start an 'ongoing advice relationship' with a retirement saver under [ERISA] if the advisor helped the retirement saver with even one retirement savings rollover transaction." [FACC v. DOL, No. 22-0243 (N.D. Tex. Jul. 9, 2025)]  MORE >>

"[T]he notion that a rollover recommendation could be viewed as the first in a series of transactions that could constitute a 'regular basis' -- was seen as being beyond the [DOL]'s authority.... [T]his is the second federal court holding that the long-standing assessment of what constitutes a 'regular basis' would be reinstated -- and that while advice to the participant in the plan would continue to carry a fiduciary relationship to a rollover recommendation, a separate rollover recommendation by an advisor without that prior relationship will (still) be a separate matter."  [FACC v. DOL, No. 22-0243 (N.D. Tex. Jul. 9, 2025)]  MORE >>

"Improving individuals' plan experiences and securing their future financial outcomes is (and should be) one of our industry's top priorities. Currently, their plan experience is negatively impacted by the distribution and rollover process. Their future financial outcome is jeopardized by poor decisions without expert help. Auto-portability has limited application in fixing these critical issues. A better solution is to improve the distribution and rollover process through standardization and automation."  MORE >>

"When a 401(k) account contains both pre-tax and after-tax amounts, the owner can’t later move the after-tax dollars to a Roth IRA or move the pre-tax dollars to a traditional IRA and leave the after-tax dollars alone. Any distribution from the account must contain both pre-tax and after-tax dollars in proportionate shares."  MORE >>

"The inherited account must be moved to a beneficiary account unless the beneficiary was the original owner's spouse -- and if the wrong method is used for moving the account balance, all of those tax minimization opportunities can be lost.... [T]he funds cannot be paid directly to the beneficiary even if the beneficiary intends to deposit the funds into a beneficiary account.... [T]he transfer should be accomplished via a direct trustee-to-trustee transfer."  MORE >>

"[A recent] incident highlights the problem with mailed paper checks still being common in 401(k) rollovers despite some obvious and unnecessary risks.... [P]aper checks remain a common element of the rollover process as 43% of individuals who rolled over were forced to receive and forward a paper check during their transfer.... 82% of savers surveyed think rollovers should be as easy as an Automated Clearing House (ACH) bank transfer, and unsurprisingly 84% want the option to complete a rollover entirely online."  MORE >>

"When everything goes to plan, a standard 401(k) rollover can take approximately two weeks from processing to deposit. If you add weather delays or a busy mail season to the mix, a rollover can stretch to a month.... In the case of a $100,000 rollover check, a 2-week absence from the market during an upturn could cost $37,512 in lost returns over 30 years. An 8-week delay could result in $76,000 in lost returns over 30 years, or over 75% of the original check's value."  MORE >>

"[R]olling over a Roth 401(k) comes with a unique set of rules.... [1] Make sure the amount is eligible to be rolled over.... [2] Determine if your Roth 401(k) distribution is 'qualified'... [3] Know the impact of choosing direct rollover vs. Indirect rollover.... [4] Keep track of your taxable vs. nontaxable amount."  MORE >>

"Allowing distributions by wire could reduce the risk of mail fraud, although it has risks of its own.... [H]ave appropriate policies and procedures in place to track and monitor the status of paper checks that have been issued, including with respect to checks that remain uncashed.... [C]onsider sending large checks via certified mail, return receipt requested (or similar manner by private delivery) to evidence actual delivery."  MORE >>

"Roth conversions are most optimal in a down market because you can convert more shares. You sell your holdings in your tax-deferred account and then move the money to your Roth account, where you capture any upswing in a tax-free environment. There are things you can control about this, and things that are better left to long-term planning."  MORE >>

"[1] Make sure the amount is eligible to be rolled over ... [2] Take RMDs before rollovers ... [3] Under age 59½? Check for 10% penalty-exception retention ... [4] Choose a direct rollover, not an indirect rollover."  MORE >>

"FINRA is focusing on services and recommendations by broker-dealers and their registered representatives to retirees, senior investors and investors with diminished capacity. [The 2024 FINRA Annual Regulatory Oversight Report] has one part that specifically focuses Reg BI's application to plan-to-IRA and IRA-to-IRA transfer recommendations."  MORE >>

"[1] Waiting until the 11th hour to contribute to an IRA ... [2] Assuming Roth IRA contributions are always best ... [3] Making a nondeductible IRA contribution for the long haul ... [4] Not contributing to an IRA later in life ... [5] Forgetting about spousal IRA contributions ... [6] Running afoul of the Roth IRA five-year rule ... [7] Triggering a tax bill on an IRA rollover ... [8] Not being strategic about RMDs from a traditional IRA ... [9] Not paying enough attention to IRA beneficiary designations."  MORE >>

Detailed chart of limits for qualified plans, as well as IRA/Roth-IRA and ESA phase-out ranges and HSA Limitations.  Includes Rollover Chart.  MORE >>

"[T]he SEC is focusing on advice to retirees and older investors, as reflected in the 2025 Examination Priorities.... This reflects a policy concern that older investors are in a category where abuses could be more likely and that therefore warrants special focus for examination.... Broker-dealers and investment advisers should review and consider augmenting their policies, practices and supervision for services to older investors and retirees."  MORE >>

"While it is true that traditional automatic rollovers have unquestionably helped plans mitigate a portion of their cost and risk, it's also true that they have negatively impacted many participants' ability to properly save for retirement."  MORE >>

"[O]nly 22% of savers manage to roll over an account without assistance, and 42% reported that the process took them two or more months to complete. Compounding the issue, 54% of savers weren't originally sure where their old 401(k) was located."  MORE >>