Direct Rollover
Categories: Investing, Tax, Trusts and Estates
Good dog.
As the saying goes, the only constant in life is change. You know what that means: even your retirement accounts aren’t immune to change.
A direct rollover is when we’re moving house from one retirement account to another. Since you can’t just take money out of an official retirement account willy-nilly, a direct rollover is a process that helps you move that money over without getting penalized or taxed...as long as you complete it within 60 days, and as long as it’s not a rollover into a Roth IRA. Sometimes there are fees, but they’re usually not too bad.
Don’t go thinking you can get sneaky-sneaky and take some cash during this transaction. The direct rollover won’t even be passing through your hands; it’ll go straight from your initial account custodian to your new one. For instance, from your old employer to your new one, if that’s why you’re changing retirement accounts.