NerdWallet's Smart Money Podcast
Retirement Rollover Ready? Rules, Risks, and Rewards of 401k and IRA Transfers
04 Nov 2024
Learn the pros, cons, and methods of rolling over retirement accounts to simplify your finances so you can avoid costly mistakes. How can you budget smarter for the holidays? Does it make sense to combine retirement accounts from previous jobs into one? What are the benefits and drawbacks of different rollover options? Hosts Elizabeth Ayoola and Sara Rathner begin the episode with a discussion of holiday budgeting, offering tips and tricks on avoiding impulsive spending, setting clear financial priorities, and the importance of delayed gratification. Then, hosts Sean Pyles and Sara Rathner discuss retirement account rollovers and key considerations to help you streamline your retirement savings and avoid penalties. They begin with a discussion of rollover basics, with tips on direct vs. indirect rollovers, how to avoid unexpected costs, and how to choose between an IRA and a Roth IRA. Credit Card Nerd Jae Bratton joins Sean and Sara to discuss her own experiences with retirement rollovers. They discuss the pros of consolidating accounts, the financial security it can offer, and how to choose the right investment options to suit your retirement goals. Interested in consolidating your old retirement accounts? Our investing writers broke down the best IRA accounts for hands-on or hands-off investors: https://www.nerdwallet.com/best/investing/ira-accounts And the best Roth IRA accounts categorized by online brokers or robo-advisors: https://www.nerdwallet.com/best/investing/roth-ira-accounts In their conversation, the Nerds discuss: holiday budgeting, retirement rollovers, financial management, impulsive online shopping, retirement account rollovers, direct rollovers, indirect rollover, IRS penalties, Roth 401k, Roth IRA, 403b, traditional IRA, tax compatibility, retirement savings, financial priorities, budgeting tips, holiday spending mistakes, investment flexibility, IRA options, consolidating accounts, retirement planning, contribution limits, managing finances, budgeting strategies, simplifying retirement accounts, retirement account consolidation, and financial goals. To send the Nerds your money questions, call or text the Nerd hotline at 901-730-6373 or email [email protected]. Like what you hear? Please leave us a review and tell a friend. Learn more about your ad choices. Visit megaphone.fm/adchoices
Full Episode
Who hit fast forward on 2024? Like, how are we in November already? Sarah, am I alone in feeling like this year was on turbo speed?
You're not. I still think 1975 was 20 years ago.
I like the end of the year for two reasons. Now, one, I'm a self-reflective journaling chick, and I enjoy doing my year in review exercises. And for two, I'm a December baby. Shout out to all my Sagittariuses. But anyway, we're going to be delving more into the former today. Welcome to NerdWallet's Smart Money Podcast. I'm Elizabeth Ayola. And I'm Sarah Rathner.
And for the record, I do not journal. We got to talk about that more later. I know. All right. This episode, we answer a listener's question about combining retirement accounts from different jobs. But first, Sarah and I are going to talk about the worst budgeting or financial mistake that we have made this year.
Now, if we want to add a splash of festivity to the topic, we can focus on holiday spending mistakes. It's your call, Sarah. And yes, that means you're going first.
Yeah, no pressure. Well, we could apply this to holiday spending, but we could also apply it to spending year round. And for me, it's just so easy, like way too easy to try to solve problems by buying stuff online. And I can't count the number of times I thought I had the problem to solve. And I threw money at some small thing. And I thought it would be the solution to my problem.
And then the package arrived a few days later. And I'm like, why did I buy this? It's like this death by 1000 Amazon purchases.
I'm certain that so many people feel seen right now, Sarah, because you shared that. And you know what? I hate to say that I can relate, but I must say that I'm proud of a new habit that I've developed. So I have started returning things to Amazon that I do not need. Yes, before I was too lazy to return them, so they would just sit around my house.
Now, I think the option to drop items at Whole Foods, shout out to Amazon for that, has been a source of motivation. Nothing beats saving money by returning things I don't need and picking up a few healthy food items in the process.
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