If you are changing jobs, retiring, or have lost your job, you are probably facing an important decision that could have a long-term impact on your financial situation. What to do with the money you have saved in your company's retirement plan?

401(K) plans are designed to make saving for retirement simple and attractive by enabling your employer to take regular pre-tax withdrawals from your paychecks. However, determining what to do with the retirement plan when you are leaving a job is far more complicated, and requires careful thought and planning.

You have several options for your eligible 401(K) when leaving an employer. In general, the money you invested is eligible for a rollover when you leave your job. Some of your options have tax and penalty consequences, so you must weight them carefully before proceeding.

If you are over age 59-1/2, are not taking your 401(K) funds in a lump sum or have certain extenuating circumstances, different rules may apply to you. Here are a few of them:

Direct rollover to an IRA rollover account:** In opening an IRA rollover account, you move your money into another account. When you open the account, the money from your 401(K) is paid directly to the account you establish allowing you to avoid any taxes and penalties, keeping your money growing, tax-deferred.

Direct rollover to your new employer:** If you are moving to another job rather than retiring, most employers will allow you to move your money from another qualified plan into theirs. Before you do this, make sure the new plan offers you a wide range of investment options. If it doesn't, consider opening a rollover account.

Stay invested in your current plan: If you have $5,000 in your current employer's qualified plan, you probably have the option of leaving it there. This will give you more time to determine what to do with the assets.

Take the money in cash: If you decide to take all your money out of the plan in cash, you will face stiff tax consequences and penalties. Your company will withhold 20% in income tax and a possible 10% penalty if you are younger than age 59-1/2.

**If you decide to have a check made out to you rather than having the assets directly transferred to your new employer or the new IRA rollover account, you must roll the money over within 60 days from the date you personally take receipt of your retirement plan assets. If not rolled over in this time period, the distribution could be subject to income tax as well as a 10% excise tax. You won't receive a refund until you file your tax return for the year.

Rob Ryan is committed to providing quality investment advice for the prudent investor, while striving to work toward the attainment of each investor's financial goals and objectives. Our efforts are focused on helping each client's assets grow in order to achieve their dreams, while managing their money in accordance with their lifestyle.

We would like each investor to enjoy a quality experience with our firm. We strive to achieve this mission with a high level of integrity, honesty and professionalism for each client whom we have the opportunity to serve.

463 Century Park Drive

Yuba City, CA 95991

(530) 671-2100

www.ryanwealth.com

*Rob Ryan is a Registered Representative offering securities and advisory services through Royal Alliance Associates, Inc., a registered broker-dealer and SEC registered investment advisor, Member FINRA, SIPC. Ryan Wealth Management, not affiliated with Royal Alliance, offers insurance and estate planning.