{"id":93,"date":"2010-05-10T20:29:25","date_gmt":"2010-05-11T00:29:25","guid":{"rendered":"https:\/\/blog.bradpine.com\/?p=93"},"modified":"2012-02-23T13:08:31","modified_gmt":"2012-02-23T18:08:31","slug":"dusting-off-your-retirement-accounts","status":"publish","type":"post","link":"https:\/\/blog.bradpine.com\/2010\/05\/10\/dusting-off-your-retirement-accounts\/","title":{"rendered":"Dusting Off Your Retirement Accounts"},"content":{"rendered":"
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Image by flickr<\/p><\/div>\n<\/div>\n
Spring cleaning should apply not only to your house but to your retirement accounts. Whether you\u2019ve maintained 401(k) accounts<\/strong> at old employers or have already opened a Rollover Individual Retirement Account (IRA)<\/strong>, keeping an eye on where your accounts are held and what you\u2019re invested in can help you to get the most out of your savings.<\/p>\n
If you\u2019ve left your retirement savings with former employers, you should consider rolling over your 401(k) plans into an IRA. A direct rollover, rather than taking a distribution and depositing the assets later, will ensure that you keep the tax deferred status of your assets and avoid potential penalty fees.<\/p>\n
Why go through all the trouble? While there are exceptions, most people would benefit from transferring their money into an IRA. IRA accounts generally provide greater flexibility and lower fees. While 401(k) plans are limited in the choices of mutual funds they offer to participants, brokerage IRAs often come with an enormous breadth of investment options. Further, though your 401(k) may enjoy preferential pricing in terms of mutual fund fees, it is also likely to carry additional plan administration fees and expenses.<\/p>\n
Once you\u2019ve rolled over your retirement savings, it is important to look at the risk and return profile of your portfolio. When was the last time you reviewed your portfolio strategy and mix of investments? Certain investments or mutual funds provide a false sense of diversification and security, making it important to regularly analyze your holdings. Focus not only on the risk characteristics and asset mix of the portfolio, but on the fees charged by your mutual funds. Very often, you will find that there are funds that better suit your needs at a lower cost than what you\u2019re currently paying. My article \u201cInstitutional Investing for the Individual Investor<\/a>\u201d covers this topic in detail.<\/p>\n