“My ex-adviser at a big box broker wanted me to move my $4 million in retirement money to an IRA. His reasoning was that I’d have more choices and better performance (that I pay for). My 401(k) has great choices, very low fees and a brokerage account. Seems like a conflict of interest, right? What I really need is help with conversions before RMDs kick in in five years. Given that, who should I be working with?”
When an adviser recommends rolling a large 401(k) into an IRA, investors should look beyond a promise of “better performance.” MarketWatch’s The Advicer examines the potential costs, conflicts of interest, tax implications, and protections to consider before making a move.
Our founder, Jeff Herman, was invited to share his thoughts on these considerations. His perspective: some investors may be comfortable managing investments on their own. Others may value advice that connects their accounts to a broader retirement-income strategy—including how and when to draw from different accounts and whether Roth conversions make sense. The right decision depends on the investor’s full financial picture.
SCHEDULE A CONVERSATION WITH JEFF TODAY
While a 401(k) is an effective savings tool, it won’t provide advice tailored to someone’s full financial picture. “Investors who feel comfortable managing their investments on their own may not need a broker,” says Jeff Herman, founder and investment adviser at The Jeffrey Group. “Many people, however, value working with an adviser to build a retirement-income strategy that considers how and when to draw from different accounts and whether a Roth conversion makes sense, including when and how much to convert. It seems like you would benefit from understanding how the pieces fit together and how your savings will work to support a steady income throughout retirement.”
Jeff is passionate about RMD strategies. To learn more, check out his posts below:
BLOG | RMDs | This Is What I Wish I Knew Before I Turned 73
BLOG | RMDs | Should I Take Social Security at 62 or Use Retirement Savings First?
BLOG | RMDs | How Do RMDs, Social Security and Taxes Fit Together?