Author Topic: First 401k roll over. Looking for advice on the process.  (Read 1706 times)

Late_Bloomer

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First 401k roll over. Looking for advice on the process.
« on: May 28, 2016, 10:49:40 AM »
Hi folks. My wife is starting a new job in two weeks so we have to do a roll over. Never done this before and not sure the process so I have some questions.

Does she need to coordinate with both employment companies, or file standard forms, and from which company?
Will we lose funds for conversion purposes or some other similar nonsense?

I haven't looked over her new company 401k options yet but I do know She will have similar avenues for allocation. I admit, I still have to do more research but this should be a standard process right?

Thanks for any advice, which I will be sure to take into consideration.

Kaydedid

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Re: First 401k roll over. Looking for advice on the process.
« Reply #1 on: May 28, 2016, 11:03:06 AM »
Following, since we're in a similar situation.

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Ursus Major

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Re: First 401k roll over. Looking for advice on the process.
« Reply #2 on: May 28, 2016, 11:28:56 AM »
Are you planning to roll the old 401k into an IRA or into the new 401k? If the latter, make sure that the new 401k actually accepts such roll-ins, as far as I know they don't necessarily have to. Also you don't necessarily have to roll out the money from your old provider, that depends on the plan (and usually the amount you have invested).

Either way you'd want to make this rollover as a trustee-to-trustee transfer, ever the money is directly transferred from your old 401k provider to your new IRA/401k provider. The new provider should have a form for that, contact them. The old provider will liquidate the funds and transfer the money to the new provider. You may lose money in the conversation, if the old provider charges a fee or of some of the funds with them had back-end loads.

Jim2001

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Re: First 401k roll over. Looking for advice on the process.
« Reply #3 on: May 28, 2016, 11:32:56 AM »
Ursus Major got it banged out before I could and the information is great.  In most cases, the 401k/IRA sponsor your transferring to should be able to coordinate and handle the transaction for you.


Tris Prior

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Re: First 401k roll over. Looking for advice on the process.
« Reply #4 on: May 28, 2016, 01:31:21 PM »
I actually just did this. I had to request a direct rollover from the company that held my 401k. This ended up being more complicated than it had to be, because my ex-job where I had the 401k went out of business, and no one had any idea whom I should talk to. (I called the number on my statement and no joy; they told me to contact my former employer and were not quite understanding that Former Employer no longer exists!)

Anyway. Once I finally was given a contact person and number, it was relatively painless. They did charge me a $65 "withdrawal fee." :( The new plan had the money in my new account 1 day after receiving the rollover check.

Make sure you get it done as a direct rollover - check made payable to the new plan, NOT directly to you. Otherwise they'll nail you with taxes.

Every company's different and your new plan should have some sort of form that details how they want this to be done. Mine (Fidelity) told me to have the rollover check mailed to me, but made out to them, so I could send the check and the Fidelity forms together. I hear that other plans want the check mailed straight to them. Just follow your new plan's directions and you'll be fine.

Hvillian

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Re: First 401k roll over. Looking for advice on the process.
« Reply #5 on: May 29, 2016, 02:17:16 PM »
I did a 401(k) to 401(k) rollover.  Pretty painless - handled by the Payroll/HR person at the new job.  I think I just give my authorization to the prior employer and fill out a little paperwork.

For my wife, I didn't like the investment options in her old plan or new one, so I rolled her money into an IRA at Vanguard to give us more investment and conversion options down the road.  You may want to consider this if her new plan isn't great.

SachaFiscal

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Re: First 401k roll over. Looking for advice on the process.
« Reply #6 on: May 29, 2016, 09:49:21 PM »
I've changed jobs a couple times.  After the first job I rolled over the small amount in my 401k to an IRA, I worked with an financial advisor, working for the company managing the IRA who took care of everything for me. After the second job I had enough in the 401k account that the company let me keep the money in and I didn't roll it over for a while.  Usually that is not recommended but I was a little lazy with my finances back then.

A couple years ago I found MMM and starting realizing that consolidating all these retirement accounts into one Vanguard account and choosing index funds with low expense ratios was a good idea.  I just called up Vanguard and they took care of everything right there on the phone. It was really easy. For the 401k rollover they conferenced in the company managing the 401k and guided the discussion for me, asking the right questions. 

I would think you would want to roll her 401k into an IRA with more investment options rather than another 401k with likely less options.  At least that's what I would do.  Is there a specific reason you want to roll it over into the new company 401k rather than an IRA?