You are here:

Retirement Planning/Rolling over from one retirement plan to another

Advertisement


Question
Hi there,

I'm an employee with the State of California, and I'm about to leave state service for the private sector.  I have money in my CalPERS account, and i want to move that money over to wherever I can and keep building on it with the new job.  I have zero knowledge here, so i don't even know what questions to ask about how to do this.  Where can I start and what should I do to keep from being penalized?  I have no interest in drawing the money out, but there seem to be limitless possibilities on what to do and how.  I need to know my options and what the best ones are...

~Jeff

Answer
Hi Jeff,
Congratulations on your new job! I almost always recommend that when a person leaves a job that they rollover their old tax deferred retirement accounts to an IRA at an outside brokerage. You will incur, no penalty or taxes at this time. This gives you access to far more investment options and more control over your money. It's also very hard to figure out what you are paying in investment expenses because their are a few charges they are not required to disclose. These are also the same reasons why you don't want to rollover to your new companies 401k if one is available. I can't give you a specific recommendation on where to rollover but there are many companies who would be more than happy to help you. If you don't know anyone who can recommend an advisor, there are many options such as Fidelity, Vanguard, T Rowe Price, etc. The major life insurance companies are also an option. They have advisors and access to many different types of mutual funds, bonds and stock. I would stay away from the big firms such as Morgan Stanley, Smith Barney, Chase, etc. They will most likely try to sell you the proprietary funds that make the most money and charge you a management fee as well. Please feel free to ask any more questions. I hope this helps!

Dave

Retirement Planning

All Answers


Answers by Expert:


Ask Experts

Volunteer


David M Iannopollo

Expertise

I am a professional financial advisor who can assist you with answers on mutual funds, annuities, IRA's, rollovers, qualified and non-qualified retirement plans, retirement planning, educational planning, life, disability and LTC insurances. I can also show you how to take advantage of the stock market gains without the risk of loss!

Experience

I have over 25 years experience in the business and financial world.

Education/Credentials
Life experience has been my greatest education!

©2016 About.com. All rights reserved.