Have you always worked for the same company? Most people answer no to this question. In fact, people change jobs much more frequently today than in previous generations. There are a whole host of reasons, from corporate downsizing to finding a better opportunity. Perhaps you have an employer-sponsored retirement plan with one or several previous employers. These accounts are Qualified because they are tax-qualified and they usually are 401k, 403b and 457 plans.
Do you have IRAs with financial institutions with which you have no contact? It is not uncommon for some people to have IRAs with several mutual fund companies, banks and credit unions, insurance companies and other investment firms.
Consolidate: Talk with your investment advisor about transferring or rolling over those accounts to one firm. By having them invested at one or a couple of places, you will find it much easier to keep track of investment performance and beneficiary arrangements, and it will be easier to change addresses if you move. You are your investment advisor will be better able to manage the proper allocation in the different types of investment accounts you choose that match your risk and reward expectations.
Make sure you know what the fees are to close the old accounts and set up new ones. Know what your new ongoing fees are going to be. Do not “liquidate and ship” (sell investments and transfer) each account without analysis; your investment advisor should complete a review of each investment. Some may be very good investments that you should keep. Often the new investment firm can transfer the account ‘in kind‘ or change the servicing advisor or firm on the account. Lastly, make sure that you are informed about surrender charges, if any, that you will pay to make the transfer.
