Should I do Rollover IRA?

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bogatir
Posts: 19
Joined: Thu Aug 18, 2016 12:07 am

Should I do Rollover IRA?

Post by bogatir »

Hello,

I have 5 401k's right now for a total of $785k. I'm in my early forties. Some of these have good funds, but the largest one doesn't have a total market fund (it's still in Vanguard at least). Each one has target retirement funds. I'll start a new job soon, so I'll have six of these, which starts to sound like too many.

Should I move everything into a Rollover IRA? I like the peace of mind that they can be together with my brokerage account and also that I'm not going to be purchasing from five different sets of funds. However, I have read that I can do mega backdoor roth and it's affected by having a large rollover IRA? *Maybe* I'll take advantage of that with my next job, so closing that option stops me from taking action here. What do you think I should do?
vshun
Posts: 219
Joined: Fri Feb 06, 2009 9:48 am

Re: Should I do Rollover IRA?

Post by vshun »

Backdoor Roth affected by Rollover and you want to avoid it if your income is approaching Roth contribution limits (like close to 200K for MFJ). If you feel you will not approach that level in your career I would roll it to your brokerage (Fidelity, Vanguard, Schwab, etc) for convenience of single login and also to avoid potential fees (some 401K plans have now monthly fees).
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Svensk Anga
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Re: Should I do Rollover IRA?

Post by Svensk Anga »

You can roll an old 401k into a new employer's plan. If you like what is available in the plan at your new job, you could pursue that instead of rollover IRA.
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retiredjg
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Re: Should I do Rollover IRA?

Post by retiredjg »

bogatir wrote: Tue Jul 09, 2024 8:52 am However, I have read that I can do mega backdoor roth and it's affected by having a large rollover IRA?
Backdoor Roth is affected by a rollover IRA. If you ever think you might need/want to use the backdoor Roth process, the rollover will get in the way.

Mega-backdoor Roth is not affected by a rollover IRA.

Another option, if you like your new 401k plan, is to roll some or all of the old ones into the new one.
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wwhan
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Joined: Sat Mar 03, 2007 11:08 pm
Location: CA

Re: Should I do Rollover IRA?

Post by wwhan »

Don't rollover to IRA.

Move all the 401K assets, to the best 401K plan you currently have.

Consider the 401K company (Fidelity or?), fund options and expense ratios. Some 401K plans have a brokerage link option (Fidelity).
invest4
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Joined: Wed Apr 24, 2019 2:19 am

Re: Should I do Rollover IRA?

Post by invest4 »

I don't see any issue with the rollover IRA if you are not doing Backdoor.

I rolled over my previous employer's 401k which is currently with Fidelity and have no issues or concerns. Of course, if you have a great 401k, it can also be nice to have all in one place and /or if you have options via your new plan that you would like to take advantage of.
LotsaGray
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Re: Should I do Rollover IRA?

Post by LotsaGray »

Svensk Anga wrote: Tue Jul 09, 2024 9:47 am You can roll an old 401k into a new employer's plan. If you like what is available in the plan at your new job, you could pursue that instead of rollover IRA.
Maybe, I don't believe all plans accept rollovers. The costs as well as available funds also need to be considered.
LotsaGray
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Re: Should I do Rollover IRA?

Post by LotsaGray »

wwhan wrote: Tue Jul 09, 2024 10:57 am Don't rollover to IRA.

Move all the 401K assets, to the best 401K plan you currently have.

Consider the 401K company (Fidelity or?), fund options and expense ratios. Some 401K plans have a brokerage link option (Fidelity).
Very few if any 401K plans accept rollovers if you are not a current employee. OP could roll everything into his current plan if they accept and then leave it there. Or if new employer plan is better role it all there once he was in. That would get down to 2 or 1 plans but depends if either current or next plan are "decent".
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