401k rollover to TSP, 457 plan or IRA

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burn
Posts: 4
Joined: Tue Sep 23, 2014 10:56 am

401k rollover to TSP, 457 plan or IRA

Post by burn » Sat Apr 14, 2018 9:00 pm

I am looking for some advice on what to do with a 401k plan from my former employer. It is a sub 10k balance at Mass Mutual.

I have a TSP account from a stint with the Federal Government and have a 457b plan with my new employer. The TSP account does not have a particularly large balance due to a partial withdrawal I made to cover some large medical bills a few years ago.

The existing 401k is with Mass Mutual and has expense ratios higher than my other three options.The new 457b plan is with Voya and gives me access to Vanguard funds, mostly their target funds, but also a few of their large cap funds, etc.

As I see it, I have 4 options.

1) Leave it where it is.
2) Rollover to TSP.
3) Rollover to new employer 457 plan.
4) Rollover to new IRA account with provider of my choice (Vanguard probably).

Having the account in an IRA where I can make the choices I want with the account seems appealing, but putting it in the TSP or 457 seems simpler.

I'm torn about even maintaining the TSP account at this point since the account balance is so low, but the fees are low...

motorcyclesarecool
Posts: 462
Joined: Sun Dec 14, 2014 7:39 am

Re: 401k rollover to TSP, 457 plan or IRA

Post by motorcyclesarecool » Sat Apr 14, 2018 9:15 pm

Nongovernmental 457s can be raided by your employer’s creditors in the event of a bankruptcy. Roll it to the TSP and don’t look back. Consider growing your TSP by making deductible IRA contributions and rolling them to the TSP annually.
Understand that choosing an HDHP is very much a "red pill" approach. Most would rather pay higher premiums for a $20 copay per visit. They will think you weird for choosing an HSA.

burn
Posts: 4
Joined: Tue Sep 23, 2014 10:56 am

Re: 401k rollover to TSP, 457 plan or IRA

Post by burn » Sat Apr 14, 2018 9:36 pm

My new job and the 457 are with a government agency, just not federal.

Fishing50
Posts: 241
Joined: Tue Sep 27, 2016 1:18 am

Re: 401k rollover to TSP, 457 plan or IRA

Post by Fishing50 » Sun Apr 15, 2018 4:32 pm

TSP has great options...Don't ever give it up!
It's perfectly legal, go ask the IRS, they'll say the same thing. I actually feel stupid telling you this, I'm sure you would've investigated the matter yourself. Andy Dufresne

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Earl Lemongrab
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Re: 401k rollover to TSP, 457 plan or IRA

Post by Earl Lemongrab » Sun Apr 15, 2018 4:52 pm

I might be misremembering, but I seem to recall that rollovers from a 401(k) to TSP can be complicated due to some form that the sender has to fill out that some don't want to deal it. You could roll from the 401(k) to an IRA, then to the TSP. I don't know if that would be beneficial or not.
This week's fortune cookie: "Your financial life will be secure and beneficial." So I got that going for me, which is nice.

retiredjg
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Joined: Thu Jan 10, 2008 12:56 pm

Re: 401k rollover to TSP, 457 plan or IRA

Post by retiredjg » Sun Apr 15, 2018 4:59 pm

1) Leave it where it is. :(

2) Rollover to TSP. :D

3) Rollover to new employer 457 plan. :D

4) Rollover to new IRA account with provider of my choice (Vanguard probably). :?

The only problem with rolling to an IRA is that you may wish to use the back door approach to getting money into Roth IRA some day and the IRA would get in the way. Options 2 and 3 avoid that problem.

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