Investment amateur question - Move employer 401K to Vanguard

[Just Joe]

Hello folks.Hope you can enlighten me.

I recently rolled an old 401K from a previous employer from Empower to Vanguard. I was impressed to finally see the balance begin to grow significantly from interest alone. That 401K has been stagnant for ages. Fees?

The transaction was easy peasy.

I have a fair sum of money in a 401K with my current employer that I would like to do the same with. I have suspicion that Empower's fees are significantly high though I can't quite prove that. I'd like to dodge those fees by removing the middle man (Empower Retirement) as much as possible and moving the majority of my 401K to Vanguard directly.

Empower's financial advisor says I'm not allowed to do this as long as I am with my current employer which I expect to remain the same for the foreseeable future.

Is this true that I can't reinvest my money with someone else? I don't really trust Empower simply b/c their fee structure has not been easy for me to find. Guess I need to do another deep dive.

The other option I suppose would be to put the minimum money into my 401K to get my employer's match and then deposit the remainder of what I have been sending to Empower into my Vanguard account.

I assume there are pre-tax limits and there are better places to put money than sending it post-tax to Vanguard b/c post-tax.

Sorry for the amateur nature of my questions. Lacking a local or family mentor and all the financial advisors I find here (small town) are selling something so not fiduciaries.

[MDM]

Is this true that I can't reinvest my money with someone else?

Yes, if you are under age 59.5 (60?).

I don't really trust Empower simply b/c their fee structure has not been easy for me to find. Guess I need to do another deep dive.

See Expensive or mediocre choices for some guidance.

[Just Joe]

Thank you MDM. Disappointing rules. I thought the whole idea was that 401Ks were portable but I see now the limitations placed on us. For those of us staying put (b/c pensions) that's a very long time that adjustments can't be made.

I'll certainly read the link you shared.

[Wintergreen78]

Your quarterly statement from Empower should list gross fees for each investment option.
Read the italicized text at the bottom of the list of performances and fees to see additional notes.

The term for moving money from a 401k to an IRA while you still work for an employer is an “in-service rollover”. My understanding is that most plans do not allow this.

Even if your investment options have high fees, you are still likely better off investing the money instead of letting it sit in a money market account.

[Bartlebooth]

So many vague things that barely make sense...amateur indeed but you can learn!  (How does one post 6,000 posts in this forum without becoming a 401(k) master?  Pretty interesting.)

What was the money invested in when in the old Empower plan? (Doesn't matter any more but you will learn things in the process of figuring this out.)

What is the money invested in now in the new Vanguard plan?

Why can't you prove fees?  They should be clearly listed in transaction history.

Why doesn't Empower have low-cost funds?  I know plan admins (your HR department typically) can choose funds from what the 401(k) provider (Empower) offers, but there are some common ones that it would be surprising to not see.  Most likely you have target date funds...0.04% expense ratio on those according to this: https://www.empower.com/client/jpmc/enrollment/documents/investment_funds.pdf  Those would be an OK starting point.

You cannot simply put the minimum in Empower and the rest in Vanguard, and hey you did allude to knowing this.  Nice!  The Empower contributions are going to be following 401(k) contribution rules/limits.  The Vanguard contributions would be one of taxable/TradIRA/RothIRA depending on your qualifications and choice.

The in-service rollover comments by others seem accurate.

[Just Joe]

I have learned TONs of good things from these forums and you good people.

Post count: too much chatting, not enough hard investment homework. Learned alot about frugality, not enough about investing. Did learn some good things along the way. 

We have pensions and we dumped everything else we could afford to into our 401K. Not much to optimize I thought. Then the topic of fees came up.

Exactly what are we paying? Coworker thinks we are paying 2%(!) I can't quite answer that question yet. Working on it. Sent an email to HR looking for the right person to ask questions of.

So I'm probably going about all this backwards but that would be typical. Don't have many (any?) people close around me who know anything about this topic. Every one of my friends think they know something about it but hear-say seems to be an important part of their knowledge. 

Found a local financial advisor (fiduciary), am making an appointment, also making an appointment with the Empower rep who sends everyone emails here inviting employees to meet with him.

I basically want to optimize what DW and I are doing with our money. We're not retiring early b/c late start.  We're on track already for a comfortable retirement. Pensions plus our investments should yield an income similar to our current income easily enough but without a mortgage b/c that will be paid off in a few more years. 

[MDM]

Exactly what are we paying? Coworker thinks we are paying 2%(!) I can't quite answer that question yet. Working on it. Sent an email to HR looking for the right person to ask questions of.

Can you view your 401k plan online?  If so (and you should be able to), look for an "expense ratio" column.  See 401(k) Selections for an example.

There may be other flat fees, but understanding the individual fund fees would be a good start.

[Just Joe]

Thank you MDM. I'll look tonight after dinner.

[Wintergreen78]

In my on-line Empower site (the mobile version) I go to Investment Lineup. There is a pdf called “Detailed Fund Performance” that includes the gross expense ratio and the net expense ratio for each option.

[Just Joe]

Thank you Wintergreen78.