401K to IRA

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sparkyelec99
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Joined: Wed Jan 01, 2020 4:55 pm
Location: SF Bay area

401K to IRA

Post by sparkyelec99 » Tue Jan 07, 2020 7:26 pm

How to consolidate various 401K from previous employers into an IRA? Do I have to liquidate the funds and move cash? Vanguard website doesn't have specific instructions. Any guidance is appreciated.

retired@50
Posts: 1062
Joined: Tue Oct 01, 2019 2:36 pm

Re: 401K to IRA

Post by retired@50 » Tue Jan 07, 2020 7:59 pm

sparkyelec99 wrote:
Tue Jan 07, 2020 7:26 pm
How to consolidate various 401K from previous employers into an IRA? Do I have to liquidate the funds and move cash? Vanguard website doesn't have specific instructions. Any guidance is appreciated.
It depends. Some 401k investments aren't actually held in mutual funds, although they seem like they are, sometimes the 401k assets are in collective investment trusts, or separate accounts, or other quasi-mutual-fund-like investments. If any of your old 401k accounts hold assets in this way, they may need to be liquidated before moving to an IRA. If your old 401k investments are actually in mutual funds, you can likely do what is known as an "in-kind" transfer of the assets. Then, you'll just hold the same investment at Vanguard inside your new Rollover IRA account. Then, you can sell or re-arrange the assets any way you'd like.

I'd suggest you get out all your old 401k account statements, or print them from the 401k website(s), then get on the telephone with Vanguard to get the process started. Dealing with the institution that will ultimately hold the assets is typically the best approach.

Regards,
Boggle - a game from Parker Brothers. Bogle - investor, founder of Vanguard.

billfromct
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Re: 401K to IRA

Post by billfromct » Tue Jan 07, 2020 8:04 pm

When I moved my Fidelity 401k to Vanguard a couple of years ago:

-moved my 401k mutual funds to cash
-called Fidelity & told them wanted to do a "trustee to trustee" transfer (no taxes withheld)
-Fidelity made the check out to VFTC (Vanguard Fiduciary Trust Company) FBO billfromct (Fidelity would not do a direct transfer) & Fidelity sent the check to me
-I called Vanguard telling them what I wanted to do & the process I needed to follow
-I made a cover letter explaining exactly what I wanted Vanguard to do including my rollover IRA account number & a copy of my Fidelity 401k statement; I then sent the cover letter & check to Vanguard (I left nothing to chance & included all the details)

bill

Jablean
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Joined: Sat Jun 02, 2018 2:38 pm

Re: 401K to IRA

Post by Jablean » Tue Jan 07, 2020 11:41 pm

Pick 1, hopefully with transferable funds and get the Rollover IRA started by talking with Vanguard - they'll talk with your current broker.

Once you've got it established then usually pretty easy to start everything online for the other accounts. It will give you a tool to pick the broker and funds you are moving (and answer a question if you prefer to transfer in-kind or cash out), upload a statement, and then let Vanguard at it. They'll contact you if something doesn't come over and they'll request the cash out if that's what you want.

carmonkie
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Re: 401K to IRA

Post by carmonkie » Wed Jan 08, 2020 1:05 am

Does your current job offer a reasonable 401(k)? Does it allow 401(k) transfers? If it does you can try consolidating there instead. The reason I suggest this is because if your income is large enough that you are not able to contribute to a Roth, you can do a backdoor conversion. Having traditional IRA would trigger the Pro-Rata rule. Even if your income is not there yet, it could be in the future so just suggesting an alternative.

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One Ping
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Re: 401K to IRA

Post by One Ping » Wed Jan 08, 2020 1:25 am

billfromct wrote:
Tue Jan 07, 2020 8:04 pm
When I moved my Fidelity 401k to Vanguard a couple of years ago:

-moved my 401k mutual funds to cash
-called Fidelity & told them wanted to do a "trustee to trustee" transfer (no taxes withheld)
-Fidelity made the check out to VFTC (Vanguard Fiduciary Trust Company) FBO billfromct (Fidelity would not do a direct transfer) & Fidelity sent the check to me
-I called Vanguard telling them what I wanted to do & the process I needed to follow
-I made a cover letter explaining exactly what I wanted Vanguard to do including my rollover IRA account number & a copy of my Fidelity 401k statement; I then sent the cover letter & check to Vanguard (I left nothing to chance & included all the details)

bill
Why did you include a copy of your 401k statement? Was that a Vanguard requirement?
"Re-verify our range to target ... one ping only."

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bogglizer
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Joined: Tue Aug 16, 2016 8:56 pm

Re: 401K to IRA

Post by bogglizer » Wed Jan 08, 2020 2:25 am

Every time I've done this, I moved all my accounts to Vanguard directly. No checks came to me. I either used Vanguard forms to pull or the 401(k)/403(b) plan forms to push for the direct transfer, depending on what seemed easier. My accounts were all TIAA or Fidelity.
My intellectual superiority will shortly be demonstrated here by a pithy quotation.

Jablean
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Joined: Sat Jun 02, 2018 2:38 pm

Re: 401K to IRA

Post by Jablean » Wed Jan 08, 2020 3:14 am

One Ping wrote:
Wed Jan 08, 2020 1:25 am
billfromct wrote:
Tue Jan 07, 2020 8:04 pm
When I moved my Fidelity 401k to Vanguard a couple of years ago:

-moved my 401k mutual funds to cash
-called Fidelity & told them wanted to do a "trustee to trustee" transfer (no taxes withheld)
-Fidelity made the check out to VFTC (Vanguard Fiduciary Trust Company) FBO billfromct (Fidelity would not do a direct transfer) & Fidelity sent the check to me
-I called Vanguard telling them what I wanted to do & the process I needed to follow
-I made a cover letter explaining exactly what I wanted Vanguard to do including my rollover IRA account number & a copy of my Fidelity 401k statement; I then sent the cover letter & check to Vanguard (I left nothing to chance & included all the details)

bill
Why did you include a copy of your 401k statement? Was that a Vanguard requirement?
I know that Fidelity is asking for statements to help verify account numbers/funds. They'll do it without but may have to contact you if numbers don't match up that you manually put in.

Mmaarrkkiivv
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Joined: Sat Feb 03, 2018 7:36 am

Re: 401K to IRA

Post by Mmaarrkkiivv » Tue Jan 14, 2020 9:37 pm

bogglizer wrote:
Wed Jan 08, 2020 2:25 am
Every time I've done this, I moved all my accounts to Vanguard directly. No checks came to me. I either used Vanguard forms to pull or the 401(k)/403(b) plan forms to push for the direct transfer, depending on what seemed easier. My accounts were all TIAA or Fidelity.
Appreciate it if you can you explain the process?
I am planning to move all my 401k from past employers to Vanguard and don't want to go the check route.

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bogglizer
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Joined: Tue Aug 16, 2016 8:56 pm

Re: 401K to IRA

Post by bogglizer » Tue Jan 14, 2020 10:18 pm

Mmaarrkkiivv wrote:
Tue Jan 14, 2020 9:37 pm
bogglizer wrote:
Wed Jan 08, 2020 2:25 am
Every time I've done this, I moved all my accounts to Vanguard directly. No checks came to me. I either used Vanguard forms to pull or the 401(k)/403(b) plan forms to push for the direct transfer, depending on what seemed easier. My accounts were all TIAA or Fidelity.
Appreciate it if you can you explain the process?
I am planning to move all my 401k from past employers to Vanguard and don't want to go the check route.
I would love to be helpful, but the last time I did this was 4 years ago, and it is foggy. I had to download forms, fill them out, and send them to the other institution, sometimes with that weird bank ID check that isn't a notarization. I know I sometimes pushed funds and sometimes fulled. Sorry!
My intellectual superiority will shortly be demonstrated here by a pithy quotation.

Mmaarrkkiivv
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Joined: Sat Feb 03, 2018 7:36 am

Re: 401K to IRA

Post by Mmaarrkkiivv » Tue Jan 14, 2020 10:41 pm

No worries! Thank you. I will call Vanguard and see what's the best way to move everything.

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Brianmcg321
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Re: 401K to IRA

Post by Brianmcg321 » Tue Jan 14, 2020 10:46 pm

I just call Vanguard and they take care of it. The last time with my Fidelity 401k we had a three way conference call with them. Took all of 5 minutes.
Rules to investing: | 1. Don't lose money. | 2. Don't forget rule number 1.

Spirit Rider
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Joined: Fri Mar 02, 2007 2:39 pm

Re: 401K to IRA

Post by Spirit Rider » Wed Jan 15, 2020 12:07 am

retired@50 wrote:
Tue Jan 07, 2020 7:59 pm
If your old 401k investments are actually in mutual funds, you can likely do what is known as an "in-kind" transfer of the assets.
It is rare for a 401k plan to do in-kind transfers to an external custodian. The only cases of in-kind transfers I have seen is when the 401k administrator/custodian and IRA custodian were one in the same. I have transferred between two 401k plans at the same custodian and still had the plans transfer cash.

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