We know saving for retirement is a top priority for many investors. No matter where you are in the planning process, you may have questions. We can help. Check out the questions we've already answered, or if you're a Fidelity customer, submit your own. We'll post replies to selected questions on a weekly basis.
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For more than 60 years, through all kinds of market conditions, Fidelity has been helping people like you pursue their financial goals. Ken Hevert and Sarah Walsh, who lead our Ask Fidelity team, have spent decades helping investors understand retirement strategies. They can help put Fidelity’s expertise to work for you.
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The maximum amount that can be contributed to your SIMPLE IRA is $15,500 for both 2015 and 2016 tax years if you are age 50 or over. The limit is $12,500 for those under 50; however, your contribution cannot be greater than your annual salary from the employer who offers the SIMPLE IRA. The employer can also match your contributions up to 3% of your compensation, or may make a non-elective contribution equal to 2% of compensation.
In addition to your SIMPLE IRA contributions, you may also make contributions of up to $6,500 to a Roth IRA for 2015 and 2016 tax years since you and your wife are over age 50. The limit for those under age 50 is $5,500. You can find more information about SIMPLE IRAs at https://www.fidelity.com/retirement...
If you have further questions, you can speak with one of our retirement specialists at 800-544-5373, Option 3, or consult with your tax advisor regarding your specific situation.
Thanks so much for this opportunity to help you!
First, the Hewitt Money Market Fund you mentioned in your question sounds like it may be a proprietary fund, meaning that it can only be held in an account or plan administered by Hewitt. To be sure, it would be best to contact the firm where your account is held right now and ask them if that specific fund is eligible to be rolled “in-kind” or if it needs to be liquidated so that cash proceeds can be distributed according to your wishes. If it is eligible to be moved in-kind, you may also want to take another step and reach out to the firm where you decide to move the fund and inquire if they’ll accept the shares or not.
Next, you have a number of options when it comes to what you could do with retirement savings in an old 401(k) or workplace plan. Briefly, they are:
• Provided your balance allows for it, keep your assets in your old employer’s plan.
• Roll your assets into your new employer’s 401(k) plan.
• Roll your assets into a Rollover IRA.
• Cash out from your old workplace plan.
Each option should be considered carefully as you decide what may be the right choice for you and your unique situation. Rolling your assets into a Rollover IRA can help you accomplish your goal of investing in stocks of your choosing. In some instances though, workplace plans may have the option for you to direct a portion of your retirement savings to a self-directed brokerage linked account where you can accomplish the same goal. Cashing out an old 401(k) is almost never a good idea—not only will you owe taxes on the funds withdrawn, but if you are under age 59½, you will be subject to an early withdrawal penalty as well.
A good start for you to decide what’s best for you would be to read one of our Fidelity Viewpoints® articles, What to do with an old 401(k):
A Fidelity representative can also certainly talk with you if you have any additional questions. I hope you find this information helpful!
I hope this information is helpful.
First, congratulations on beginning to save for retirement at a young age. The more time you give yourself to take advantage of potential compound growth in tax-deferred or tax-free retirement savings accounts, the better off you may be.
Choosing investments in an IRA is unique to each individual, as each of us has a unique set of objectives for our retirement savings. Given your age, you might decide to be more aggressive in your investing than someone who is closer to retirement. A good place to begin understanding which specific types of investments may be appropriate for you is by visiting our Planning & Guidance Center on Fidelity.com: https://www.fidelity.com/calculator...
In addition to providing a way to create a holistic retirement plan and analyzing your current investments at Fidelity and elsewhere, the Planning & Guidance Center can help you create an investment strategy within your IRA and other accounts to work toward your retirement goals.
Another resource you can use to become familiar with the different types of investments available is on our Choosing Investments for Your IRA page:
If you have additional questions, any of our representatives would be happy to discuss investment options with you. You can contact us at 800-343-3548.
Thank you again for your question. I hope you find this information helpful.
Important Additional Information:
Guidance provided by Fidelity through the Planning & Guidance Center is educational in nature, is not individualized, and is not intended to serve as the primary basis for your investment or tax-planning decisions.
Thank you for your question. It’s important to leverage as many opportunities as possible to save more for retirement, and the catch-up election in your workplace plan is a great way of doing that.
You can easily increase your contribution amount online through NetBenefits®. After logging in with your username and password, open the “Quick Links” dropdown menu below the balance of your 401(k) and select the Contribution Amount option. The page that will come up provides you with options to change the amount you contribute or enroll in an annual increase program, provided your plan allows for that option. Follow the Contribution Amount link and you’ll be presented with options to increase your election there. For 2015, the catch-up contribution limit for those age 50 and older is $6,000, in addition to the annual contribution limit of $18,000. Keep in mind that any employer match does not count toward these limits.
Depending on your employer’s plan, the option to increase may be included in your overall total amount eligible to contribute, all in one source, or it may be presented to you as two different sources.
If you need assistance increasing the contribution amount for your 401(k), you may speak with one of our representatives by calling 800-835-5095.
Thank you again for your question. I hope you find this information helpful!
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