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Question for the Money Doctors

Question submitted on Jun 20, 2011.

Question

Is it better to move money out of the 401k plan of the employer you just left and into an IRA in terms of consequences to beneficiaries?

Answer

A rollover from a 401K plan to an IRA has no tax or distribution consequence to your beneficiaries providing you properly fill out the beneficiary designation form on your IRA application. 

The primary reason to roll you money from a 401K to an IRA is to transfer total control and management of the account to you.   


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