Dear Clients and Friends,
The sun has finally come to San Francisco! If you're not familiar with the pattern of seasons here in SF, we have finally entered our sunny and warm fall season. It's a relief after our extremely cold and foggy "summer". In addition to the wonderful weather, I have additional good news to report. If you haven't already heard, my lovely wife Colleen is pregnant with our first child! She is due October 18th and we couldn't be more excited! We've been busily nesting, arranging, preparing and simplifying our home in preparation for the coming whirlwind of activity.
Speaking of whirlwinds, we are all dealing with the recent market turbulence. Unfortunately, the political theater in the US, coupled with the ongoing Euro-zone crisis, continues to cause significant turmoil in the markets day-to-day with each new headline. I addressed this in my last quarterly letter (click here, to see it again) and in the mid-quarter client update; so I'm not going to belabor it again in this letter. But if you have any questions, or just want to talk, don't hesitate to reach out.
In addition to baby prep, I have been on-boarding several new clients which involved consolidating accounts and rolling over 401(k) accounts from previous employers. Which leads me to the topic of my current letter...
Pros and Cons of Rolling a 401(k) to an IRA
(Or: To roll... or not to roll.)
Generally speaking, you cannot roll a 401(k) from you current employer to an IRA. You can only roll over a 401(k) from a previous employer. Many people these days have several older 401(k) accounts from previous employers floating around. In that case, there are two rollover options:
Roll into your new 401(k):
Roll over an old 401(k) into an IRA.
At Bootstrap Capital, in many cases, I have found it appropriate to roll over old 401(k)s into an IRA. This forms the basis of the investment management and financial planning process and allows the client to develop a personal plan that is not available to them from a traditional 401(k) plan. If you have any questions about 401(k) rollovers, please don't hesitate to contact me. And, as usual, if your friends and family have questions about rollovers, or any other financial issue, please don't hesitate to make an introduction or forward this letter. We provide Financial Planning and Investment Management services and would be happy to talk with your acquaintances. We will treat your friends and family with the same care and diligence that we treat you.
Note: The contents of this site are general in nature and not intended as specific investment advice. All investments are subject to risk; including loss of investment value. If you have any question regarding investments or concepts in these pages, please consult with an investment professional.