Saving for retirement can be difficult and most Americans are aware that Social Security will most likely not be able to provide for their needs when the time comes. A popular solution to this problem is the IRA, or the Individual Retirement Account. There are several different types of IRAs available and are designed to be used by different people in different circumstances. Generally, the funds held in an IRA cannot be taken out without penalty or taxes, but many people may not be aware that funds can be transferred from one IRA to another, or even from other types of retirement accounts, such as a 403b or a 457b. This transfer process is known as a rollover.
IRA to IRA
Transferring from one IRA to another IRA is a fairly simple process and there are two primary ways to do it. Both methods first involve notifying the custodian of the IRA that is going to be transferred. Then, it is a question of either directly transferring funds from one custodian to another, or for the individual to receive a check that is then given to the new custodian. This check must be deposited within 60 days and in some cases, a portion of the funds is withheld until the new IRA has been established. This is primarily the case when the original IRA was with an employer. The withheld funds are returned later, but it may be a long time before they are available.
IRA to Physical Gold IRA
A growing trend with many savvy investors is to use a gold IRA rollover to put their money into physical gold or other precious metals. This type of rollover is similar to other IRA rollovers, and the only real difference is that the new IRA needs to be a Roth or Self-directed IRA that allows for physical gold to be purchased by the custodian. Some custodians may not be experienced in this type of rollover, so it is always helpful to find a custodian who specializes in precious metals.
403b to IRA
A 403b is a retirement plan that is also known as a “tax sheltered annuity.” A 403b is usually set up by an employer and a portion of an employee’s salary is deposited into the account. When an employee leaves and gets a new job somewhere else, the 403b does not transfer. It is possible, for a 403b to rollover to an IRA. The process is much the same as a rollover from one IRA to another. The two options are the same: a direct rollover, or a check that must be deposited within 60 days. In the case of a 403b rollover, 20% of the funds are withheld and returned later if the rollover is made successfully. When planning for a 403b rollover, it is often necessary to complete a signed contribution form and make arrangements with both custodians.
457b to IRA
A 457b plan is not an option for everyone; rather, they are retirement plans available to government workers or those who work for nonprofit organizations. The money placed in a 457b plan is tax exempt and any money gained is also tax exempt until withdrawals are made upon retirement. The funds in a 457b can be transferred to a rollover IRA. Any kind of IRA is an option, although it should be noted that as 457b funds are pre-tax, it may be necessary to pay taxes on them before transferring them to a rollover IRA like a Roth IRA that is after tax. Again the two methods of transferring to a rollover IRA are the same, either with a direct transfer or with a check that must be deposited within 60 days.
The right IRA can be a great way to save for retirement and relax without worrying about economic collapse. For those looking for a gold rollover IRA, you can see our reviews of companies here.