Rollover
Rollover is a financial term used to describe the process of transferring funds from one account to another. It is commonly used in the context of retirement accounts, such as 401(k)s and IRAs, where funds are moved from one account to another in order to take advantage of tax benefits or other incentives. It can also refer to the process of transferring funds from one currency to another, or from one investment to another.
History of Rollover
The concept of rollover has been around for centuries, but it was not until the mid-20th century that it began to be used in the context of retirement accounts. In the 1950s, the US government introduced the 401(k) plan, which allowed employees to save for retirement on a tax-deferred basis. This plan allowed employees to rollover funds from one account to another, allowing them to take advantage of tax benefits and other incentives. Since then, the concept of rollover has become increasingly popular, and is now used in a variety of contexts.
Comparison Table
| Type of Rollover | Tax Treatment |
|---|---|
| 401(k) to IRA | Tax-deferred |
| IRA to 401(k) | Taxable |
| Currency to Currency | Taxable |
| Investment to Investment | Taxable |
Summary
Rollover is a financial term used to describe the process of transferring funds from one account to another. It is commonly used in the context of retirement accounts, such as 401(k)s and IRAs, where funds are moved from one account to another in order to take advantage of tax benefits or other incentives. It can also refer to the process of transferring funds from one currency to another, or from one investment to another. For more information about rollover, you can visit websites such as Investopedia, The Balance, and the IRS website.
See Also
- 401(k)
- IRA
- Tax Deferral
- Taxable Income
- Currency Exchange
- Investment Portfolio
- Asset Allocation
- Mutual Funds
- Stocks
- Bonds
