Working with a broker has many advantages for the client.
A good broker has an unbiased opinion as to which company and product best fits the needs of the client. They have access to multiple carriers and are not subjected to the products of just one company. Brokers represent the CLIENT, not the COMPANY.
They can provide knowledge and experience. A good broker will deal with facts and not just give you an opinion of what they think is best. They will educate you on the subject, give you viable options and work with you to come to a solution.
Once the client-broker relationship is formed, the client has a professional to bring their questions and concerns to. Finance is often a confusing industry and it is important to have an experienced, trusted advisor to call upon when needed.
Going it alone is a huge gamble. Brokers and advisors are constantly learning about new products and viewing the financial landscape. It is not expected of an individual who is not familiar with the industry to be aware of the intricacies of financial solution design. People who are not familiar with the products could get themselves into an irreversible situation which could severely set them back for a significant amount of time.
Working with a broker is not a financial commitment. Most do not charge a consultation fee and will give you advice for free. Even if you already have an advisor, a second opinion on things is always a plus.
Trying to do his way gold rollover ira.
What is a 401k rollover?
A 401k rollover is when an individual chooses to transfer the funds of an existing account with a previous employer to a new company. Individuals usually do this to have better control over their retirement savings and retain the tax benefits that they enjoyed with their previous plan.
What happens if I leave my 401k with a previous employer?
401ks that are left with an employer after an individual has severed ties with that organization can either keep being invested or put on hold. The individual can no longer add funds to the account and investment options are usually limited.
Can I just cash out my 401k?
You can elect to have the plan administrator write a check for the entire 401k amount. In fact, this is the most popular option in the United States. Unfortunately, this is also the worst possible option. If chosen, not only will 20% of the entire account be deducted for tax purposes, 10% more is due as a penalty. All tax deferral benefits of the accumulated amount are also lost.
What is the rollover process like?
The process of rolling over a 401k or IRA is simple. The client will consult with the broker to devise a plan and determine an appropriate investing strategy for them. The client then fills out an application and the company that is receiving the assets communicates with the old company to secure the funds. This process usually takes about a month, but can be longer. Once the new company is in possession of the funds, the agent will deliver the new policy. Upon receipt of the new policy, the client has up to a one month “free look” period in which they can change their mind about the new policy without any penalties.
What is an annuity?
An annuity is an investment vehicle designed for retirement savings. There are two stages of an annuity, accumulation and annuitizing the funds. The accumulation stage is when the investor grows the investment. Upon completion of this stage, the investor has the option to annuitize, thus turning his investment into an income stream for life.
What’s the difference between a fixed annuity and a variable annuity?
A fixed annuity provides a guaranteed fixed interest rate whereas a variable annuity is invested in the market, usually in mutual funds.
By Michael Brown
Retirement planning expert and rollover IRA to gold adviser.