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If you’re approaching age 59½, you’ve hit an important financial milestone. New options are now available, and you may not realize just how many decisions you have in front of you.

In this episode of Money Wisdom, Nicholas J. Colantuono, CFP® and Eric Hogarth, CFP® explain how flexibility at age 59½ can be a game changer for your retirement.

Why 59½ Matters

At 59½, many employer-sponsored 401(k) plans allow in-service rollovers. While you’re still working, you may be able to move your 401(k) into an individual retirement account (IRA).

For most of your career, a 401(k) has been a great tool for saving for retirement. But retirement planning is a different phase of life. Once you stop contributing and start thinking about withdrawals, your relationship with the stock market changes. The investments that helped you save may not be the best vehicles for your long-term security.

IRAs Offer Control, Balance, & Tax Advantages

One of the main reasons many people roll their 401(k) into an IRA is because of control. 401(k)s typically offer a limited menu of investment options under the umbrella of your employer’s plan. An IRA offers more flexibility for investments, managing risk, income strategies, and tax planning.

In retirement, your goal is to turn your savings into reliable income. To do that, you need to make sure some of your money continues to grow while another portion is accessible and protected. That growth and income balance is often difficult to achieve inside a 401(k) alone.

Another significant advantage of IRAs is broader tax planning. After 59½, you can access retirement funds penalty-free, though income taxes still apply. This allows for strategies like Roth conversions and reducing future required minimum distributions (RMDs).

Understand All Your Options

Many people keep their retirement savings in a 401(k) simply because it’s familiar or has performed well. But good past performance doesn’t mean this strategy will fit your current stage of life. If you don’t have a plan when the market eventually falls, you may realize too late that your options were limited.

At 59½, you don’t need to make any changes to your accounts, but you should understand your options. This is a phase of life where flexibility, control, and intentional financial planning matter more than ever. The right decision will depend on your unique goals, taxes, risk tolerance, and retirement timeline.

Curious how your 401(k) fits into your investment strategy? Get your free Ultimate 401(k) Guide by texting “GUIDE” to 800-757-0436.