Is there any benefit to rolling over 401 K with new company

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Any real benefit to doing it?

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For me it depends on your ability to manage it. If you're moving into a plan where you have very little option on where to have your money then keep all the capital in the old account.

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I have never seen a benefit, in fact most often fees are higher in 401k's than IRA's, not to mention sometimes you are limited in your fund selection

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These are legitimate reasons to roll the old 401k into an IRA. However, if you plan to do a back door Roth conversion, it will make it harder to do so if these untaxed funds are co-mingled with after tax contributions.

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However, if you plan to do a back door Roth conversion, it will make it harder to do so if these untaxed funds are co-mingled with after tax contributions.

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This is the main reason. I only have a traditional IRA to backdoor into a Roth. If I rolled over my 401k into the traditional then taxes would become an issue.

I'm not crazy about the fees but the fund options for me are pretty good.

But the best part is the 401k loan option. I've used them in the past as a last resort for real estate. I only wish I could do repayment plans shorter than 1 yr.

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Keep 2 seperate iras. One for rollovers and one for backdoor

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Second time I've seen this posted yet see no where online that says this avoids taxes.

Have a source link?

You say that you would have to pay taxes again on any post tax contributions then post a link explaining how it is prorated.

The reason to keep 2 is it makes it easier to roll one into an existing 401k to shield it from the backdoor

So I am in the same position as the OP. I bookmarked this thread awhile back but am still a little confused on some of the info in it. I am planning on leaving my old 401K in the companies program however will I now be susceptible to fees? Also the backdoor Roth deal, can I get a simplified clarification on this. I currently have a Roth that I am funding but this is likely (hopefully) the last year I will come in under the limit.

I dont have any of the company stock in the 401k, we had a DSPP and that is being converted to common and I will be putting it in my personal TD account.

How does a backdoor Roth work? I am assuming it is when you pull funds from a 401k to fund a Roth after you are already making past the limit?

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How does a backdoor Roth work? I am assuming it is when you pull funds from a 401k to fund a Roth after you are already making past the limit?

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Nope, let's say you make too much money and can't fund a ROTH(or file separarely which effectively kills it). There is a loophole where there is no income limit on Roth conversions. So what people do with a high income is fund a Traditional IRA and then immediately convert to a Roth to bypass the income limitations.

The issue with rolling over your 401k to an IRA is if in the future you plan to do a backdoor Roth, the funds already in your IRA become subject to tax when they regularly wouldn't once you execute the conversion to the Roth, hence why some people either keep their old 401k or rollover to their new one, so they keep their IRA "clean" for conversions to their Roth.



There is however, apparently something called a Mega backdoor roth that involves certain 401ks and their distribution rules concerning after tax contributions which let's you put in something like $35,000 into your Roth but it's an option in a minority of 401k plans