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2. The 401(k) plan at my last company had inferior returns, and high expenses. I rolled it over to a Fidelity IRA as soon as possible. As someone else mentioned, it is essential to make this a custodian-to-custodian transfer. Do NOT have them send a check to you! The benefits people sent me a check erroneously, and I immediately sent it back and told them to do the rollover correctly. Even if you transfer the money to the IRA within the 60-day deadline, the mere fact of receiving a check could trigger a problem, since the 1099-R won't say "Rollover" -- and that's what the IRS sees.

One clarification on the 401(k) rollover. Some 401(k) administrators will send the check, payable to you and the rollover IRA custodian, to you. This is not a problem. You just endorse the check and send it with your custodian's paperwork.

Phil Marti
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