The term "rollover" refers to the process of moving retirement savings from a qualified retirement plan to an IRA, commonly referred to as a Rollover IRA, or to another qualified plan.
When you change jobs or retire, you may be eligible to receive a distribution from your employer-sponsored retirement plan. What will you do with your "lump-sum distribution"? Even if the amount seems modest, the money you invested represents important assets you'll need for retirement—assets you'll want to protect and grow.
A rollover gives you the opportunity to continue growing your retirement savings on a tax-deferred basis until you withdraw this money in the future.
There are two types of rollovers to consider:
Option #1: Request a direct rollover into a Rollover IRA, or into another qualified plan.
Option #2: Receive the distribution in a check made payable to you.
IRS CIRCULAR 230 NOTICE: This information is not intended to be used and cannot be used by a taxpayer for the purpose of avoiding penalties that may be imposed by law. For more information about this notice, see northerntrust.com/circular230.