UnThreaded | Threaded | Whole Thread (6) | Ignore Thread Prev | Next
Author: TMFJeanie Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 76418  
Subject: Re: What to do with an former employer's 401k Date: 10/16/2000 8:30 PM
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Recommendations: 0
All you need to do is get forms
from the brokerage where you want to set up the IRA (whether it
be Vanguard, etc) and then get your old company to make out a
distribution check. My husband's place sent us a check which we
then forwarded with the paperwork to Vanguard, others will send it
directly.


A small word of caution, just to keep life simple :-)

Beware of the word "distribution". It's less of a hassle for you if you open your new account as an "IRA Rollover Account" and allow the new broker to handle the transfer of funds from your former employer's 401(K) plan. When you send in your application for the new account, include a copy of your most recent 401(k) statement with instructions to roll it into the new IRA. They'll take it from there.

In other words, you've not taken a distribution (your hands never touched the money). If the only way your old company will handle it is to send you a check, then in order to avoid taxes and early-distribution penalties, you'll need to show that the monies were rolled over within the 60 day limit.

It's just so much easier to never touch the money while it's in transit from one account to the other.


Jeanie
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (6) | Ignore Thread Prev | Next

Announcements

The Retire Early Home Page
Discussion on accelerating retirement day.
Foolanthropy 2014!
By working with young, first-time moms, Nurse-Family Partnership is able to truly change lives – for generations to come.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Post of the Day:
Macro Economics

Looking at Currency Ratios
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement