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Double Your ROI When You Rollover a 401k to an IRA (Individual Retirement Account)
What are good reasons to roll over a 401k to an IRA? One of my clients recently asked this question. So, I furrowed my brows, then looked at the ceiling and thought.
All retirement accounts have benefits. Some have flaws. At best, the plan is sponsored by an employer who makes matching contributions, allowing you to grow your fund faster than you could on your own. That’s what you have with a 401-K; at best.
But since these are employer-sponsored plans, one reason to roll over a 401k to an IRA is to change jobs. But your new job may also have an employer-sponsored retirement plan. If this is the case, the best solution may be to transfer the fund from one custodian company to another. It’s possible that your new and old employers even use the same guardianship company, which would really simplify things.
Generally speaking, trust companies allow you to invest in mutual funds or stocks. Sometimes government bonds are offered for those who want to “play it safe”. Companies like T Rowe Price, without actually offering advice, rank the mutual funds they offer by risk. Of course, all funds are linked to the stock market, so there is always risk involved.
The IRS allows retirement funds to be invested in a variety of other assets, including real estate. But most companies that manage 401-Ks don’t allow investors to choose other options. So one reason to roll over a 401k to an IRA is the ability to diversify the fund by investing in less traditional, higher-yielding, or less-risky options.
To do this, you need a self-managed account. A truly self-investing custodian will allow you to choose any option allowed by the Internal Revenue Code. You can choose from tax liens, public stocks, private stocks, structured settlements, and as I mentioned above, real estate.
Guaranteed return on investment in real estate? Yes, we offer a guaranteed return on investment of at least double what you have earned on your traditional investments like stocks, bonds and mutual funds etc. last year. That’s right, double what you earned on your investments last year. City Capitol does not guarantee how much money you will make, but they do guarantee that you will make at least double your ROI last year. I strongly encourage you to check this information for yourself. It can be the path to financial freedom in retirement.
Real estate is a good choice for diversification because your investment is safe. The account owns something real, something that has real value. Yes, this value can change, it can decrease, but it does not depend on the company’s profit or other economic factors that can affect the share price.
My client was asking about the reasons to roll over the 401k IRA because he was unhappy with the income he was getting each year. He wondered if there was a way to make more money faster.
Let’s say you have $100,000 in your retirement account and you’re currently earning 10% per year. This hasn’t happened recently, but let’s just assume for the sake of argument that you were making that much.
If you took that $100,000 and bought a house, resold it for a $10,000 profit, and then repeated that three times a year, you’d have a 30% return on your investment. So one of the best reasons to roll over a 401k to an IRA is to earn more and secure your retirement. I hope this answers the question. If you have a couple of spare minutes, please feel free to browse my website.
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