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What to do with 2 Old 401K accounts from previous employers
Posted on 4/17/24 at 11:02 am
Posted on 4/17/24 at 11:02 am
I have 2 old accounts, 1 is from a previous employer and the other is from a soon to be previous employer. New company I am going to does not offer any type of retirement at the moment (it's basically a start up).
What should I do with those 2 accounts?
What should I do with those 2 accounts?
Posted on 4/17/24 at 11:22 am to CHEDBALLZ
I would roll into an IRA, but that's me.
Posted on 4/17/24 at 12:52 pm to NATidefan
Just don’t buy $250k worth of AUPH options. Very hard lesson I’ve learned.
Posted on 4/17/24 at 1:19 pm to NATidefan
Roll it into a Roth and take the tax hit today to save in the future.
Posted on 4/17/24 at 2:58 pm to FreddieMac
You have no idea of OP's tax situation. Roth conversion may be a good strategy but not if OP is in a high bracket and probably not all at once unless it is a small balance.
Often best to wait and do conversions in lower income years perhaps in retirement.
Often best to wait and do conversions in lower income years perhaps in retirement.
Posted on 4/17/24 at 4:18 pm to CHEDBALLZ
You could roll them over into an Ira which would give you more control over them - that’s what I did. Or you could let them sit. 401k’s in general have too much in bonds for my taste, since I’m always from retirement when I rolled mine over I put it almost all into the stock market and and happy with the results.
Posted on 4/17/24 at 5:13 pm to OhioLSUfan
The trouble with rolling them into a Trad IRA is that in the future you won't be able to do those often mentioned "Backdoor Roth" deals when you start getting into upper income. This is what I have fricked around and found out.
Posted on 4/17/24 at 5:13 pm to CHEDBALLZ
Decide who you like from existing.. then roll the other into the one you liked..
I had fidelity from the first company I worked for … I changed companies a few times in my career and would just call fidelity and give them the specifics of the other one and have them roll them together.. ( moved a Schwab.. and Merrill).. let them do it for you.. they will make sure no penalties and roll over same index funds etc …or move them into something like it that they manage..
I had fidelity from the first company I worked for … I changed companies a few times in my career and would just call fidelity and give them the specifics of the other one and have them roll them together.. ( moved a Schwab.. and Merrill).. let them do it for you.. they will make sure no penalties and roll over same index funds etc …or move them into something like it that they manage..
Posted on 4/17/24 at 6:58 pm to OhioLSUfan
quote:
401k’s in general have too much in bonds for my taste,
The 401k’s I’ve been in over the years have many options for investments. You would only need up in something with too many bonds if that’s what you chose for your investment.
Posted on 4/17/24 at 8:09 pm to CHEDBALLZ
Really disappointed that I'm the first one suggesting hookers and blow.
Posted on 4/17/24 at 8:19 pm to UpstairsComputer
This isn’t the OT, we are a classy bunch here… well mostly.
Posted on 4/17/24 at 9:17 pm to deeprig9
I had a smaller 401K from my first job out of college that I rolled into an IRA (Schwab). I mentioned “back dooring” it into a ROTH and me CPA said it was going to be hard bc he would need to find the cost basis of the 401K. I threw out those forms a long time ago.
Doesn’t make sense to me but anyhow, I’ve got the money sitting in an IRA.
Doesn’t make sense to me but anyhow, I’ve got the money sitting in an IRA.
Posted on 4/17/24 at 9:46 pm to CHEDBALLZ
I just left mine as I liked the investment options and the fees were reasonable.
Posted on 4/18/24 at 7:13 am to Fat Bastard
Direct rollover into a self-directed IRA
Posted on 4/18/24 at 7:52 am to cadillacattack
Roll it and put in a low cost fund or index it
Posted on 4/18/24 at 10:27 am to Tmcgin
30+ years of experience as a Financial Advisor - now Wealth Management.
First thing, get it out of your 401ks and do a rollover and consolidate both into an IRA. This is a non-taxable event.
Company 401ks usually have a limited menu of choices to keep cost down. If you work with an advisor you can invest in a much wider array of products. Most, including me, are fee-based now. I charge 1%, which is pretty standard.
As far as converting to a Roth - it depends on your age. You will take a tax hit on any part rolled into a Roth but it's all tax-free after that. That's fine if you're 40, you've got time to make it up. Not too good if you're converting at 60. Time may not be on your side.
First thing, get it out of your 401ks and do a rollover and consolidate both into an IRA. This is a non-taxable event.
Company 401ks usually have a limited menu of choices to keep cost down. If you work with an advisor you can invest in a much wider array of products. Most, including me, are fee-based now. I charge 1%, which is pretty standard.
As far as converting to a Roth - it depends on your age. You will take a tax hit on any part rolled into a Roth but it's all tax-free after that. That's fine if you're 40, you've got time to make it up. Not too good if you're converting at 60. Time may not be on your side.
Posted on 4/18/24 at 12:34 pm to ClusterCock
quote:You can also just roll it into an IRA and invest in whatever funds are available without giving 1% to an advisor.
Company 401ks usually have a limited menu of choices to keep cost down. If you work with an advisor you can invest in a much wider array of products. Most, including me, are fee-based now. I charge 1%, which is pretty standard.
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