Many state retirees and pre-retirees often ask us, “What should I do with my State of Alaska Supplemental Benefits System (SBS) and Deferred Compensation account?” Effectively managing these retirement accounts is crucial for maximizing their potential and securing your financial future in retirement. Let’s explore the considerations and approaches for handling your SBS and Deferred Comp accounts, providing you with valuable insights and strategies to manage these essential assets.
Your SBS Account: Aligning with Your Retirement Goals
When it comes to your SBS account, the recommended strategy is typically to roll it over to an Individual Retirement Account (IRA). This move allows for efficient management under the IRA’s framework, offering flexibility and control designed to optimize your retirement assets based on your financial goals and risk tolerance. By transferring your SBS account to an IRA, you can leverage professional management and tailored investment strategies with the goal of enhancing your retirement savings, thereby strengthening your financial security and improving your post-retirement lifestyle.
Your Deferred Compensation Account: Tailored Strategies
Managing your Deferred Compensation account requires a nuanced approach, tailored to your specific circumstances and retirement timeline. Several key factors influence the optimal management of this critical retirement asset, including:
Age and Distributions
If you are under 59 1/2 and need to access the funds in your Deferred Compensation account in the near future, the best strategy may be to retain the account with the State of Alaska. Withdrawals from Deferred Comp accounts incur no age-based penalties, although taxes still apply. This feature can allow you to access your retirement funds when necessary, supporting your financial needs without penalty.
Seeking Personalized Guidance: SBS Retirement Consultants
Navigating the complexities of your SBS and Deferred Compensation accounts demands a personalized approach aligned with your financial aspirations and retirement goals. Our team is here to offer guidance tailored to you to help optimize your State of Alaska retirement accounts. Whether you need assistance with IRA rollovers, distribution planning, or the strategic management of your retirement assets, we are committed to providing the insights and support necessary to enhance your financial well-being in retirement.
If considering rolling over money from an employer-sponsored plan, you often have the following options: leave the money in the current employer-sponsored plan, move it into a new employer-sponsored plan, roll1 it over to an IRA, or cash out the account value. Leaving money in a plan may provide special benefits including access to lower-cost investment options; educational services; potential for penalty-free withdrawals; protection from creditors and legal judgments; and the ability to postpone required minimum distributions. Whether to roll over your plan account should be discussed with your financial advisor and tax professional.
