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Author: nevamore Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75800  
Subject: Need Info on self-dir IRA Date: 8/9/2000 1:19 AM
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Pixy has info about IRA'S on the Foolretirement site and he mentions rolling over a 401k to a self-directed IRA acct, but I couldn't find any more info then that statement as far as the restrictions on that type of IRA. I just retired and would like to invest the funds from my 401k, but don't know where to start. Do I convert to cash before I transfer From my 401k to an IRA? I'm holding US Stock and US Assets in my 401k. Would a (discount) broker handle my IRA? I would appreicate info on these questions and any other help you can give me. Thanks
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Author: TMFPixy Big gold star, 5000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 24021 of 75800
Subject: Re: Need Info on self-dir IRA Date: 8/9/2000 9:04 AM
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Greetings, Nevamore, and welcome. You asked:

<<Pixy has info about IRA'S on the Foolretirement site and he mentions rolling over a 401k to a self-directed IRA acct, but I couldn't find any more info then that statement as far as the restrictions on that type of IRA. I just retired and would like to invest the funds from my 401k, but don't know where to start. Do I convert to cash before I transfer From my 401k to an IRA? I'm holding US Stock and US Assets in my 401k. Would a (discount) broker handle my IRA? I would appreicate info on these questions and any other help you can give me. >>

You don't specify whether you're holding stock of your employer, but based on your wording I assume not. Normally, all your 401k holdings will be liquidated and the cash is transferred to an IRA. Once there, you reinvest it as you see fit. A self-directed IRA is merely the name given to an IRA you establish with a broker of your choice. By having the IRA in a brokerage account, you personally select the investments, and these may range from individual securities to mutual funds. Because you and not a manager decide what to use as an investment, you are self-directing the account. Hence the name.

Regards..Pixy

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Author: drippinfool Three stars, 500 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 24025 of 75800
Subject: Re: Need Info on self-dir IRA Date: 8/9/2000 11:15 AM
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Pixy said (in the context of rolling over a 401(k) to a self-directed IRA) "Normally, all your 401k holdings will be liquidated and the cash is transferred to an IRA."

My question is this. If my 401(k) assets (stock of various companies) are with the same custodian as are my IRAs (Schwab), can I simply roll over the 401(k) shares into an IRA without liquidating them?
-Chester <:|

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Author: TMFPixy Big gold star, 5000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 24027 of 75800
Subject: Re: Need Info on self-dir IRA Date: 8/9/2000 11:53 AM
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Chester asks:

<<My question is this. If my 401(k) assets (stock of various companies) are with the same custodian as are my IRAs (Schwab), can I simply roll over the 401(k) shares into an IRA without liquidating them?>>

Almost certainly no. BUT -- On very rare occasions it's possible when the custodian and plan administrator are one and the same. So, ask Schwab. My bet is the answer will be you cannot do so because the 401k and the IRA are two different vehicles or accounts.

Regards..Pixy

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Author: sfpc2770 Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 24041 of 75800
Subject: Re: Need Info on self-dir IRA Date: 8/10/2000 10:32 AM
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<<My question is this. If my 401(k) assets (stock of various companies) are with the same custodian as are my IRAs (Schwab), can I simply roll over the 401(k) shares into an IRA without liquidating them?>>

Almost certainly no. BUT -- On very rare occasions it's possible when the custodian and plan administrator are one and the same. So, ask Schwab. My bet is the answer will be you cannot do so because the 401k and the IRA are two different vehicles or accounts.

Sorry to de-lurk here in this manner, but I thought I'd make a comment on the above.

I'm currently in the process of rolling over an old 401k (GE) into a rollover IRA held at Schwab. According to both GE and Schwab, I can indeed roll over stock shares into the new IRA. GE simply requires a written letter stating:
1) The new IRA will accept stock as "stock in kind"
2) List my name, social security number
3) How to make check payable (for liquidated funds) and how to register the stocks for the shares I'm rolling over.
4) Schwab's tax id #
5) My new IRA acct #
6) Schwab's address.

A call to Schwab confirmed this and got the letter sent. Waiting to see the results now, but as far as I can tell, this will go through without a problem. Other plan admins and brokers might be different, but it is possible.

Just my .02.

Enjoy,
-Sean


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Author: nevamore Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 24046 of 75800
Subject: Re: Need Info on self-dir IRA Date: 8/11/2000 1:31 AM
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Hello Pixy,
Thanks for your help. I do have a small amt of company stock(under $4,000) with my employer. Is that a problem? I can transfer it to another fund anytime. I also have started a joint acct with my son with BUY AND HOLD. I haven't send in the contract with them yet because I'm waiting on a cash option I elected with the merger between Media One and AT&T. Can you have more than one broker? The reason I ask is one of the questions on their contract was asking if I had another broker. I also have 400 shares of Intel with a full service broker that my husband and I share jointly.
Would it be wise to transfer that to a discout broker,
and would there be a charge for that? Cheeze, I'm
awfully green aren't I????


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Author: TMFPixy Big gold star, 5000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 24048 of 75800
Subject: Re: Need Info on self-dir IRA Date: 8/11/2000 7:40 AM
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Nevamore asks:

<<I do have a small amt of company stock(under $4,000) with my employer. Is that a problem?>>

Only if you think it is. What you do with it depends on your analysis of how to take that stock. For details, see my article "Taking Stock" at http://www.fool.com/retirement/manageretirement/manageretirement4.htm.

<<Can you have more than one broker?>>

You may have as many brokers as you wish. However, the more you have, the more statements you will receive, and the more administrative hassle you will create for yourself in tracking all of those accounts.

<<Would it be wise to transfer that to a discout broker, and would there be a charge for that? >>

The wisdom of a transfer is really up to you. And, yes, there may be a charge involved from the losing broker. You would have to ask about that.

Regards..Pixy

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