Author Topic: We are transferring an old 401k into Vanguard anything I should be weary of?  (Read 2165 times)

greenmimama

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I'm reading up on which funds to choose.

My DHs company was bought out, so we need to either put the money with the new company or move it elsewhere by Jan 31st. We both think this is a great time to move it to Vanguard.

I would really appreciate any wisdom, we are 40, and planning to work for at least 10 more years.

Wolf359

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Before you do this -- do you have any plans for making a backdoor Roth contribution?  Having a large traditional IRA balance will complicate that strategy.

It will transfer over as cash, so think about your asset allocation (you get to start over.)

Double-check the balances after the transfer.  When I did my transfers, Vanguard made an error.  (It was complex -- multiple transfers for multiple account types.)

Conduct the transfer as trustee-to-trustee so the check never touches your hands.

Gone Fishing

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Does the new company offer institutional Vanguard funds?  If so, they may have a lower expense ratio than moving the funds directly to Vanguard under a "retail" IRA.

How old is your husband?  When does he plan to retire?  If the either number is close to 55, the money could be more accessible if it is moved into the current employer's 401(k) instead of to Vanguard.

Tjat

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It really depends on what your new 401k plan offers. In some cases, 401k plans are more flexible than IRAs and if the options are good (passive index options at low cost), there's no sense not using it.


Mighty-Dollar

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I'm reading up on which funds to choose.
Pick a stock index fund and a bond index fund.

greenmimama

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I should have mentioned we don't plan on him being at this company for more than 6mo, he will be starting his own small business, so that's why we were just switching it over to VG