I have a 401k at work but they are ending the program. I got a packet saying I have until the 20th to move it or they would move it themselves and I would have to pay a maintenance fee whatever they move it to. I have a Charles Schwab Roth IRA. Can I move it into there? Or is there somewhere better to move it to? Thanks
Where to move 401k from job
byu/Famous-Broccoli-3141 ininvesting
Posted by Famous-Broccoli-3141
3 Comments
If it’s a traditional 401k, you usually can’t roll it straight into a Roth IRA without it counting as a conversion and triggering taxes. That’s not necessarily bad, just something to be aware of.
Most people in that situation roll it into a traditional IRA to keep it simple and avoid fees. Since you already have an account at Schwab, opening a rollover IRA there could make things cleaner.
I’d probably avoid letting the employer pick where it goes. Those default options tend to come with fees that add up over time.
Schwab-Do it ASAP. Win/Win by moving it. You’ll have a lot more and cheaper investment options.
I’m assuming that you’re not close to retirement.
I prefer Fidelity and Vanguard to Schwab. Contact any of the three and they’ll tell you how to do this move.
DO NOT ACCEPT A CHECK planning to deposit it into an IRA. The company will withhold 20% in case you don’t deposit the check. Then, if you only deposit the check’s amount, the 20% will constitute an early withdrawal, subjected to taxes and penalties.