Recent graduates tend to be in a low tax bracket early in their careers when it pays for them to save as much as they can in a Roth IRA or Roth 401(k), writes an industry expert.
The most important consideration is that clients are able to complete the 35-year work period because benefits are based on the 35 highest-paid years from their careers.
Make sure clients understand that a 401(k) rollover could trigger a hefty tax bill, and that liquidating assets before the age of 59 1/2 could mean a hefty penalty.
Tapping a 401(k) isn’t good idea, so it would need to be the lesser of two or more evils. And they “would have to be pretty evil evils," says an expert.
The new Republican bill slated to replace the Affordable Care Act could result in a significant increase in health insurance premiums for older workers.
