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Listen to Johnson Brunetti's Money Wisdom with Joel Johnson CFP®, host of Better Money Television program and Forbes Contributor. Gain true financial wisdom and advice aimed at educating you about all of your financial options when it comes to retirement so you can make the best decisions for you and your family. Get information and education that can bring you peace of mind with your savings and retirement. Whether it’s your 401k account, IRA, or an underperforming asset, Joel Johnson can answer your questions and make you more aware of issues that may affect you.

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Aug 11, 2017

How to get the most out of your 401(k)’s and IRA’s, including withdrawing, roll over strategy, and how to avoid paying more than you said.

Main Questions Asked:

  • Why is the age 70 and a half so important?
  • Why are withdrawals required?
  • Does this apply to all retirement accounts?
  • Do you have to take some money out from every account you have?
  • What are the advantages and disadvantages of rolling over a 401(k) into an IRA?Key

Lessons Learned:

Withdrawals

  • At 70.5 years-old you lose some flexibility and control over your retirement accounts because that’s when the IRS forces you to begin withdrawing.
  • You can save money on taxes by saving money within a 401(k) but the IRS eventually wants their money; therefore, the tax break has to end at some point.
  • Nearly all retirement accounts fall under this requirement except for Roth IRA’s, the Roth portion of your 401(k) or life insurance plans designed for tax free future income, and certain types of annuities.
  • The IRS only cares about the total amount withdrawn from your retirement accounts, but many people find it simpler to just consolidate their accounts.
  • There is nothing wrong with someone trying to minimize the amount they pay in taxes, but it’s important to be prepared before you have to act by finding an expert that can show you the way. Saving for retirement alone isn’t enough.

Rolling Over Accounts

  • Most people eventually roll their money from a 401(k) into an IRA to not get locked into what’s available on the 401(k) menu, but the move is not for everyone.
  • The important thing is what you get to keep at the end. You need to sit down with an expert and run the numbers to see what makes the most sense.
  • Many smaller businesses may have very high cost investments.
  • Some people have accumulated many accounts from many different employers.
  • This can open you up to more risk than you realize.
  • An IRA will often give you more flexibility in the person that manages your account as well as the timing of your withdrawals.
  • You should have a balanced approach and understand the pros and cons, rolling over everything into an IRA is not always the best move. It’s best to talk to an expert that can help you plan and review your retirement strategy.

Links To Resources Mentioned

Money Map Retirement Review

1-800-757-0436

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