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Author: WotPeed Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 74759  
Subject: Rollover IRAs Date: 8/24/2006 10:46 AM
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Greetings,

Hope this is the right board for this type of stuff. I opened a rollover IRA using the funds from a 403(b) plan when I left job #1. I've now left job #2 and have some 401(k) funds to deal with. Can they be transferred to my existing rollover IRA or do I have to open another one? I don't think it matters but I also have an existing Roth IRA.

It's already a pain managing funds in several different accounts. Hopefully I don't need to add another one.

Thanks,

Wot
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Author: ptheland Big gold star, 5000 posts Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 53301 of 74759
Subject: Re: Rollover IRAs Date: 8/24/2006 11:12 AM
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Can they be transferred to my existing rollover IRA or do I have to open another one?

You can do the rollover to your existing IRA. No additional account is needed.

--Peter

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Author: WotPeed Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 53302 of 74759
Subject: Re: Rollover IRAs Date: 8/24/2006 11:15 AM
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You can do the rollover to your existing IRA. No additional account is needed.

Thanks!


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Author: zol Three stars, 500 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 53303 of 74759
Subject: Re: Rollover IRAs Date: 8/24/2006 4:24 PM
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Peter,

Does it have to be to a rollover IRA only? I need to move funds out of a 401k plan and we already have a traditional IRA opened. Years ago, we did a transfer to a rollover IRA and then merged both accounts (for some reason the brokerage house didn't transfer all the money, there is <$10 there still). Do I have to do the same thing this time around?

- zol

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Author: ptheland Big gold star, 5000 posts Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 53304 of 74759
Subject: Re: Rollover IRAs Date: 8/24/2006 4:42 PM
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Does it have to be to a rollover IRA only?

No. Several years ago there was some incentive to keep rollover 401k money in a separate IRA from your traditional IRA contributions. You could rollover 401k money to a separate IRA, then take that IRA and roll it over into a 401k at a new employer. That restriction has now been lifted, and any IRA money can be rolled over into a 401k plan, as long as the plan allows for it.

You can use any existing traditional (not Roth - yet!) IRA as the destination of a 401k rollover.

--Peter

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Author: zol Three stars, 500 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 53305 of 74759
Subject: Re: Rollover IRAs Date: 8/24/2006 4:51 PM
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Thanks Peter! Spouse has three separate 401k accounts that need to be consolidated into one.

- zol

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Author: buzman Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 53306 of 74759
Subject: Re: Rollover IRAs Date: 8/24/2006 6:08 PM
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I always recommend rolling an existing 401k into an IRA.

Lower costs.

Better investment options.

More post mortem flexiblity.

FWIW

buzman

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Author: Watty56 Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 53307 of 74759
Subject: Re: Rollover IRAs Date: 8/25/2006 11:32 AM
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Fyi,

When you roll the IRA out of one provider to another you may get hit with a processing fee of something like $50 dollars.

More post mortem flexiblity.

Translation: Currently if you are not married, or both you and your spouse get killed in a car crash, then your kids(or whoever) gets zinged big-time with taxes on the inherited 401k, a lot more than with an rolled over IRA. Apparently this is improving somewhat with the recent tax law changes but I don't know the details.

Important Note: If the 401K has company stock in it you could be in a different ball game and the rollovers can be completely different tax wise. You need to know the tax consequences on moving any company stock before you do anything.

Greg


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