My wife got a new 401k at work and due to the nature of the change can now either roll over into the new one, or into a personal IRA with Vanguard. The new plan is run through Edelman financial services. It looks like he's some sort of financial planner celebrity? Apparently been on Oprah etc. Despite this the plan is pretty good. It has admiral shares of total market and international (VTSAX, VTIAX) and some DFA bond funds with ~0.12% ER. She has about $45k in the account, but is starting to max it out now.
Is there any reason to roll this into a Vanguard IRA vs into the new plan? I keep going back and forth and so far have this list
401k prosBetter bankruptcy protection. (don't plan on it, but who does..)
Simpler, single account for everything (we both have Roths with schwab, no IRAs)
Can withdraw if quit at 55 (we're early 30s though)
IRA prosFull control! If the 401k change to something awful in the future.
IRA ConsThere is some issue with doing a back-door roth? The Pro-rata rule? We will have to do this this year. Need to read more about it
http://www.marketwatch.com/story/the-pros-and-cons-of-rolling-over-a-401k-to-an-ira-2014-01-24The one pro of the IRA is a big one though. Apparently they went with this Edelman guy because someone there use him as their advisor, and he offers some complicated 'portfolios' for most people (a mismash of mid-cap growth, small cap value international, large cap value etc etc). The ERs aren't bad (vanguard and DFA) but seems a bit random to me. Basically just 4-5 target date funds. The vanguard funds were only added because we and a few other people requested it. So may be taken away in the future..?
So gamble that the 401k will stay good, or ignore the minor advantages of the 401k and open an IRA? Is the pro-rata rule an issue?