Moving my largest 401k to Traditional IRA?

[semiretired31]

I have about $320k in a 401k from my first employer (separated from job 7 years ago). I’m ok at putting money aside, but im woefully undereducated on fee structure and reasons to move the money to an IRA. I suspect im being overcharged, but have no idea how to assess that. My thought was to move the money to a Vanguard IRA, where I could be pretty confident the fee structure would be reasonable.  But it’s only a guess. Your help is greatly appreciated.

[Morning Glory]

I have about $320k in a 401k from my first employer (separated from job 7 years ago). I’m ok at putting money aside, but im woefully undereducated on fee structure and reasons to move the money to an IRA. I suspect im being overcharged, but have no idea how to assess that. My thought was to move the money to a Vanguard IRA, where I could be pretty confident the fee structure would be reasonable.  But it’s only a guess. Your help is greatly appreciated.

I've done that. I think I initiated the transfer from Vanguard's website, but you can also call them and they'll walk you through it.

[Sandi_k]

One reason NOT to do so: you will be essentially unable to complete Backdoor Roths with the 401(k) moved to an IRA.

I would so some research on funds and fees of the 401(k) first - you may not be as bad off as you imagine.

[semiretired31]

One reason NOT to do so: you will be essentially unable to complete Backdoor Roths with the 401(k) moved to an IRA.

I would so some research on funds and fees of the 401(k) first - you may not be as bad off as you imagine.

Thank you. I hadn’t considered that, and this is my largest stache that would provide me with the most flexibility in that way.

[Proud Foot]

One reason NOT to do so: you will be essentially unable to complete Backdoor Roths with the 401(k) moved to an IRA.

I would so some research on funds and fees of the 401(k) first - you may not be as bad off as you imagine.

Thank you. I hadn’t considered that, and this is my largest stache that would provide me with the most flexibility in that way.

You didn't say if you are currently employed and have a 401k at your current job. If so you could look at the funds and fees there and roll it into the plan with your current employer if the plan allows it.

[semiretired31]

Also a good point. Currently employed and could consider rolling into that account as well. Coupl good options.

[lhamo]

If there is any chance you could be FIREing from your current employer in the year you turn age 55 (or after that milestone), check and see what their plan allows in terms of Rule of 55 distributions. 

[PDXTabs]

I’m ok at putting money aside, but im woefully undereducated on fee structure and reasons to move the money to an IRA.

You should try to figure out your fee per fund on both your old and new 401k. You can:
1. Leave the old 401k where it is (if it has low fees) - I did this for a particularly good Fidelity 401k I have.
2. Roll it into your new 401k (if it has low fees) - I did not do this, my new 401k is much worse
3. Roll it into an IRA. But this will make backdoor Roth conversions (including Mega Backdoor Roth) near impossible. It also has implications for bankruptcy protection.

So, it's all about priorities.

[semiretired31]

You are all awesome. I have some homework to do.