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Message
Rolling Over a 401K
Posted on 4/10/17 at 8:39 am
Posted on 4/10/17 at 8:39 am
I have a little over $40k in my 401k (I am 24). I will be starting a new job in about a month. My question is do you think it would be a better idea to roll it over to the new companys 401k or should I roll it over to an account with an investing firm. I would have more investment options with the firm but I like the idea of rolling it to the new company.
About 75% of the money is Roth 401k and the other 25% is before tax employer contributions.
The new company with be contributing 10% match so if I roll the $40k into the new account I think I can start to build it up pretty quick.
About 75% of the money is Roth 401k and the other 25% is before tax employer contributions.
The new company with be contributing 10% match so if I roll the $40k into the new account I think I can start to build it up pretty quick.
6
Posted on 4/10/17 at 9:32 am to cdoutdoors
I would roll it over to an account with Vanguard or Fidelity. As you mentioned you will have many more choices.
One of my sons has recently changed jobs. We reviewed the choices in his new plan. One of them is an S&P 500 Index fund with an expense rate of 0.75% and that was the lowest expense rate of any of the options. This is much higher than the 0.05 charged by Vanguard for their S&P 500 Index fund. My point is not only do you have more choices but you can probably get better choices.
One of my sons has recently changed jobs. We reviewed the choices in his new plan. One of them is an S&P 500 Index fund with an expense rate of 0.75% and that was the lowest expense rate of any of the options. This is much higher than the 0.05 charged by Vanguard for their S&P 500 Index fund. My point is not only do you have more choices but you can probably get better choices.
This post was edited on 4/10/17 at 9:34 am
Posted on 4/10/17 at 10:42 am to cdoutdoors
I was in a similar situation recently, I just rolled mine into an IRA.
Posted on 4/10/17 at 11:14 am to cdoutdoors
Always keep control of your money. Roll to an IRA.
Posted on 4/10/17 at 1:35 pm to jeepfreak
quote:
Always keep control of your money. Roll to an IRA.
I wouldn't say always. If you roll it over to a tIRA, you can screw yourself on backdoor roth at a later date.
Posted on 4/10/17 at 1:44 pm to cdoutdoors
You might lose some of the employer contributions if you're not 100% vested. Usually 3-5yrs to be completely vested.
Posted on 4/10/17 at 2:11 pm to cdoutdoors
I'm rolling one over to a Scottrade IRA right now.
Posted on 4/10/17 at 2:13 pm to lsu xman
Yeah, I actually vest the first of May. I asked my new employer to push back my start date so I wouldn't lose the company match.
I appreciate the advice, I think the consensus is to not roll it into the new employers plan. I will start doing some research on different options.
Thanks
I appreciate the advice, I think the consensus is to not roll it into the new employers plan. I will start doing some research on different options.
Thanks
Posted on 4/10/17 at 2:15 pm to Hawkeye95
quote:
I wouldn't say always. If you roll it over to a tIRA, you can screw yourself on backdoor roth at a later date.
Agreed. I've been unable to contribute to a Roth due to income limits for a few years. Backdoor roth isn't an option as I have a rollover IRA with over 250k+ in it and don't want to pay taxes to convert it.
If your new employer has good fund options then it can be a good option to put it there.
This post was edited on 4/10/17 at 2:16 pm
Posted on 4/10/17 at 7:02 pm to cdoutdoors
quote:
I wouldn't say always. If you roll it over to a tIRA, you can screw yourself on backdoor roth at a later date.
This is huge if you make too much to go directly into a Roth. I would roll it into new employers plan or leave it where it is if the fund choices are good.
Posted on 4/10/17 at 7:34 pm to cdoutdoors
It all depends on who the"investment firm" is. Use an RIA. If you think u can do it yourself go Fidelity direct. Stay away from stockbrokers, insurance agents and anyone else pushing annuities or selling products.
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