Should I transfer funds out of VOYA company account of past employer?

[risky4me]

We have about $250K (401k)n the  qualified retirement plan account(VOYA) at the company I just retired(refocused) from. It is one of the better firms as far as fees, but I feel I don't have as much control as I would with our own Vanguard(or similar) account. I have had multiple financial advisors say I should leave it where it is but it bugs me to have it in my past companies control. Like to hear others opinions on this.

[Another Reader]

Generally I would choose to roll the money into an IRA.  Likely you can do as well or better at Vanguard or Fidelity, using their low cost index funds with the asset allocation that suits you.  What is the reason these advisors tell you to leave it with Voya?  Do these people work for Voya? 

[risky4me]

Generally I would choose to roll the money into an IRA.  Likely you can do as well or better at Vanguard or Fidelity, using their low cost index funds with the asset allocation that suits you.  What is the reason these advisors tell you to leave it with Voya?  Do these people work for Voya?

Neither benefitted from leaving it where it is. One was a Vanguard rep and another was a trusted advisor who worked an American Funds account I transferred to Vanguard because of the lower maintenance fee. They stated the fee difference between Vanguard and VOYA(formerly ING) were close and they didn't feel that there was any lack of control issue leaving it where it is.

[teen persuasion]

We have about $250K (401k)n the  qualified retirement plan account(VOYA) at the company I just retired(refocused) from. It is one of the better firms as far as fees, but I feel I don't have as much control as I would with our own Vanguard(or similar) account. I have had multiple financial advisors say I should leave it where it is but it bugs me to have it in my past companies control. Like to hear others opinions on this.

Are you sure about the fees?  DH's new employer's 401k plan is thru Voya, and the fees are awful!

Unless there is a reason you don't want a balance in a tIRA (say, if you were using the backdoor Roth), I would prefer to have it under my control at Vanguard.  DH left his 401k from a former employer in that plan.  They kept changing service providers, and we would lose all account history each time they switched, and funds changed often.  Finally, I decided to roll it to Vanguard, but wasn't quick enough to get it done before they switched one more time (month+ blackout period). When the switch was complete, suddenly DH's account had a portion unvested - it had been all vested previously.  The new service provider had no back records to reference, and told us to talk with the employer.  One problem - they went out of business 12 years ago (the 401k continued for a parent company, but he never worked for them).  He was very lucky that when he contacted the parent company, he happened to speak with someone he HAD worked with, who knew that they had all been vested fully when the company closed, and she knew who to contact to straighten it out.  I had never considered that things could get messed up like that every time they transferred stuff.  So learned a lesson.

[MustacheAndaHalf]

I also question the low fees of Voya.  I think the problem here is you're relying on financial advisors when you'd do better finding information yourself, online.  Let's take two Target Retirement 2040 mutual funds:
Vanguard's VFORX charges 0.18% in fees each year.  That's $450/year on a $250,000 investment.
Voya's VTRJX charges 0.95% in fees each year.  That's $2,375/year on a $250,000 investment.

What funds at Voya have most of your money?  Maybe you could list the top few, and check out their expense ratios.  I suspect you'll find none of Voya's are under 0.50%, while all of Vanguard's funds are under 0.50%.

[AnAmericanAbroad]

Voya's fees depend on the fund and your plan, for sure. I have a 401(k) with Voya and my money is entirely in their S&P fund at 0.04%, so tough to complain there. Just check it out, as others have said.

[HPstache]

Voya's fees depend on the fund and your plan, for sure. I have a 401(k) with Voya and my money is entirely in their S&P fund at 0.04%, so tough to complain there. Just check it out, as others have said.

Boom! Good to know.

[MustacheAndaHalf]

Voya's fees depend on the fund and your plan, for sure. I have a 401(k) with Voya and my money is entirely in their S&P fund at 0.04%, so tough to complain there. Just check it out, as others have said.

That sounds suspicious.  Could you name the fund and ticker symbol?  When I search for "voya S&P fund" I get the following large cap fund offered by Voya:
Voya U.S. Stock Index Portfolio Class I  INGIX with an 0.27% expense ratio (Vanguard charges 0.05%)

Are you thinking of a non-Voya fund that you were able to purchase at Voya?  If so, that's also interesting - maybe share how you bought it with OP.  And the fund name / symbol will help for others to look it up.

Boom! Good to know.

Except it's not specific enough to actually look it up, so maybe there's a non-Voya fund involved.

[justajane]

I'm interested in what you find, because I was just discussing with my husband last night my concerns about his 401K with VOYA and whether or not we should start to do a IRA conversion. He claimed the fees were pretty good, but now I want him to check again.

[risky4me]

I'm interested in what you find, because I was just discussing with my husband last night my concerns about his 401K with VOYA and whether or not we should start to do a IRA conversion. He claimed the fees were pretty good, but now I want him to check again.

Here is what I came up with(see attachment)-

Not sure this is the whole story. I believe there are additional expenses for the plan administration- I will get that info soon.
It appears I was wrong about VOYA expense ratio- I understood it to be in the top three when it was ING. Guess I will be looking into transferring it to Vanguard.

Thanks for everyone responses!

[MustacheAndaHalf]

The list of Voya mutual funds in that PDF file shows expense ratios from 0.54% to 1.34%.  I also see "Class A" or "A shares" for the first two entries.  While I'd be surprised if a 401(k) plan had to pay these, as an individual investor you'll pay 5.75% to Voya just for the ability to buy the fund (like a sales commission).

[pbkmaine]

Load fees for A shares are generally waived in retirement plans.


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[Texconsin]

Late to the party, but yes; I can't find one good thing to say about overpriced Voya and the lack of ticker symbols on their funds.  You can do better with an online broker.

[DavidAnnArbor]

I have a 457 plan with Voya, through the state of Michigan.

I was able to find very cheap expense ratios on the index funds that were part of the plan.

However, the Voya plan charges something like $40 a year, just because.

Moreover, I seem to recall reading that every time you wanted to withdraw money out of the Voya plan you get dinged a charge.

Finally, I believe Voya likes to charge a fee for leaving them for another trustee.

I recommend exiting out of Voya over to a well-known inexpensive option like Vanguard, possibly Fidelity too.

[Cycling Stache]

We rolled my wife's VOYA 403(b) account over to her Vanguard IRA after she switched jobs.  I don't recall the expense ratios being that onerous in her particular account for index funds, but it was an easy change, and I've never thought about it since.  Vanguard is cheap, and it's nice to have everything consolidated in one place (except current employer plans).  I recommend changing it over ASAP.  No downside, and definitely some upside.

[bob22]

The expense ratios for the index investments available to me in my 401(k) through VOYA are very reasonable. For example, one that is called "S&P 500 Indexed Equity Fund" has an expense ratio of 0.02% which is tough to beat by almost any brokerage. Even with a large cap Schwab ETF that has a 0.03% expense ratio, there are still loss some losses relative to the bid-ask ratio on purchase. Other index investments have similar ratios up to 0.11%. Interestingly, these investments don't have ticker symbols indicating that they are most likely collective trusts that sell only to institutional investors like 401(k) plans.

[facepalm]

Voya's fees depend on the fund and your plan, for sure. I have a 401(k) with Voya and my money is entirely in their S&P fund at 0.04%, so tough to complain there. Just check it out, as others have said.

That sounds suspicious.  Could you name the fund and ticker symbol?  When I search for "voya S&P fund" I get the following large cap fund offered by Voya:
Voya U.S. Stock Index Portfolio Class I  INGIX with an 0.27% expense ratio (Vanguard charges 0.05%)

Are you thinking of a non-Voya fund that you were able to purchase at Voya?  If so, that's also interesting - maybe share how you bought it with OP.  And the fund name / symbol will help for others to look it up.

Boom! Good to know.

Except it's not specific enough to actually look it up, so maybe there's a non-Voya fund involved.

I have a 457(b) in a VOYA plan. They often offer straight up Vanguard funds, depending on the plan. They also offer their own proprietary funds. I have 30% of my money in VBTIX, Vanguard total bond mkt, expense ratio 0.05, and 70% in Vanguard total stock market, VSMPX. The expense ratio on that fund is 0.02%. It is an institutional fund. I pa no commissions.

Their management fee is 0.25%. Not great, but better than most. The only reason I went with them is that they offer a 457 plan, and they were cheaper than the other provider my employer works with. I already have a 403 with Vanguard.

If the OP decides to do a rollover to Vanguard they should not roll over into another 403(b). I just received a letter from Vanguard today stating they are going to start charging institutional investors $5 a month because Newport Group is going to be providing record-keeping services on their institutional accounts. Sheesh.

[COEE]

This is a good and timely subject for me.

I have left two employers in the last two years.  Both had VOYA management for their funds and their funds available varied wildly.

One was a small startup business with 50 employees and their funds sucked, and they were able to hold your funds up to 10 days after being paid before they actually invested the funds.  This was sly wording meaning that they held your money for 10 days before investing the funds.  The best fund I could invest in was a Blackrock Russell 3000 institutional fund with a net and gross expense ratio of 0.28%.  I was smart enough to close the account shortly after leaving and rollover to a tIRA with excellent ER on their funds.  It cost me $40 to close the account, and I had a $30K cash check floating around for about 15 days before I could reinvest it (talk about stressful!).  There were no other fees associated with the account that I was aware of.

The other was with a fortune 500 company with very good funds.  I've been more hesitant to close that account.  The funds are excellent.  The expense ratios on the S&P500 institutional fund is 0.06% with no additional fees.  I've been finding it hard to move it over to my IRA's.  It might save me a couple bucks... but the hassle of moving the money, converting it all to cash, having a check(s?) floating around, the market doing so well, probably paying on $40 on each account to close it (it has a 401a, 401k, and roth401k) makes it hard to motivate me to move the money.  I have not seen any additional fees associated with the account.

So, the two investment plans, although both managed by VOYA, are VERY different and whether or not to move the money away from VOYA will be very plan dependent and differ from person to person.

PS.  My investments look like I might have a 20% year!

[damnedbee]

I enjoyed the ease of using Voya, even though their fees couldn't compete with Vanguard's. Voya's tools, planners, and interface are among the best I've used, comparable to Betterment. I know that shouldn't factor in your decision, but I do miss using that user-friendly website.

[kenaces]

If you are married you might want to roll to IRA so your spouse can do a stretch IRA if you get hit by a bus tomorrow.

As others have said 401k fees are on average much higher and sometimes hard to see without really digging into the fine print