Here's the right way to avoid tax pitfalls and roll your 401(k) assets to an IRA

Here's the right way to avoid tax pitfalls and roll your 401(k) assets to an IRA  ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌  ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌  ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌  ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌  ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌  ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌  VIEW IN BROWSER | SUBSCRIBE WED, NOV 18, 2020 YOUR WEALTH Editor's Note The decision to roll over your 401(k) plan or other retirement plans is an important one. Done properly, there are many benefits, which is why so many people actually do rollovers. But if you make any mistakes, a rollover can come with serious consequences, namely costly penalties and increased taxes. The crucial difference is information – knowing what to do and when to do it. "People think it's straightforward: they retired, or they left their job, so they think they should do a rollover," certified financial planner Marguerita Cheng told CNBC. "But there are mistakes that can happen." Moving your retirement assets from one place to another doesn't need to be a stressful event if you put in the time and energy to research your options. Obviously, the more you understand how the process works, the better. Taking the time to plan your rollover ensures that nest egg you built over the years doesn't take an expensive tax hit. There are several reasons why people choose to do a rollover. To preserve the tax treatment of their savings; they don't want to leave their assets with their employer; they want more investment options; they want to use a different financial services provider; they want to consolidate assets. With that said, consider why you want to do a rollover and then weigh the pros and cons. This will allow you to know which options are best suited for your financial needs and your retirement plans. As always, when it comes to money matters, educating yourself before you do anything is the best way to protect your hard-earned retirement savings from unnecessary penalties and taxes. If you do find yourself overwhelmed or have questions you just cannot figure out, you can always turn to a financial professional for assistance. For more cool stuff like this, please follow me on Twitter @jimpavia and check out CNBC's Financial Advisor Hub and CNBC + Acorns Invest in You: Ready. Set. Grow. Jim Pavia @JIMPAVIA Here's the right way to avoid tax pitfalls and roll your 401(k) assets to an IRA Here are some situations and rules that may make you pause before embarking on a rollover from your workplace plan to an IRA. Here's what you need to know about impact investing, where returns are not the only reward Executed through direct investing platforms, impact investing addresses problems such as alleviating poverty in certain communities or reducing pollution. Here's how much your company's 401(k) match could be worth in retirement Some experts say passing on your company's match is like giving up part of your compensation, as well as an immediate return on your contributions. Wealthy families, hoping to save on taxes, are in a holding pattern. Here's why Everyone is watching two key Senate races in Georgia. Those elections, headed for runoff, could determine whether a raft of tax hikes is coming down the pike. Do you spend instead of save? Here's why – and how you can change it Your feelings about money may drive how you spend and save, but luckily you can change your ways Op-ed: Don't let inflation destroy those retirement plans As you think about what might impact your retirement, keep inflation in mind. The pandemic has caused changes that will raise costs for years. Plan ahead now. Here's what to watch for if a Medigap policy is part of your Medicare coverage If you're eyeing a Medigap plan, be sure you understand the different coverages and costs of these policies. Here are creative ways to teach your kids about charity It's the time of year when people tend to give back. While Covid may have shifted the dynamic, there are still ways to show your children how it is done. When's the best time to buy a value stock? When it figures out how to become a growth stock again " ... Investors are treating GM like it's an entirely different company. It's share price has broken out toward a three-year high as each week brings fresh news about the transformation now underway ..." CONTRIBUTORS Sharon Epperson @sharon_epperson Josh Brown @ReformedBroker Unsubscribe Manage Newsletters Terms of Service Join the CNBC Panel   Digital Products Feedback Privacy Policy CNBC Events   © 2020 CNBC LLC. All rights reserved. A property of NBCUniversal. 900 Sylvan Avenue, Englewood Cliffs, NJ 07632 Data is a real-time snapshot *Data is delayed at least 15 minutes. Global Business and Financial News, Stock Quotes and Market Data and Analysis. Data also provided by THOMSON REUTERS