401k to IRA to Solo 401k... Worth It?

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401k to IRA to Solo 401k... Worth It?

Post by Abciximab » Fri Jan 14, 2011 10:16 am

I have a Traditional IRA at Vanguard that was established after I left my last job for my present one. My new employer doesn't offer a 401k, so I thought I'd set up a Solo 401k with Fidelity to roll the assets over to. I have a side business, so the Solo 401k is an option. I would rather just leave the funds at Vanguard, but I can't do a backdoor Roth IRA conversion because of tax complications (and I don't qualify for a traditional IRA either).

So anyway, I know there are more restrictions on 401k plans than IRAs (no early withdrawals, etc), but with my tax situation I just don't see any alternative. If I leave the assets at Vanguard I wouldn't be able to contribute to my Roth anymore. Unless someone can convince Congress to just change the IRA contribution limits, I think I'm kind of forced to do this. Does anyone out there have any other ideas?
An investment in knowledge always pays the best interest - Benjamin Franklin

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