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Time to move 401k to IRAs. Fidelity questions.
04-01-2021, 12:47 PM
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#1
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Recycles dryer sheets
Join Date: Feb 2017
Posts: 267
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Time to move 401k to IRAs. Fidelity questions.
So, DH retired last year (yay!) and we're wanting to move his 401k to IRAs. The 401k is administered by Fidelity and we're planning to just leave everything with them, so I'm guessing that will simplify the process. Hopefully that's not naive of me.
What is our first move here? We have an office about an hour away but it looks like they aren't doing in-person visits. How do we get started? If I go to my local office's page, there are tons of folks to choose from, so do I just pick one and go from there? If so, and if we don't need investing advice, does it matter what their credentials are? How do we choose? We don't need investing advice, just someone experienced in these rollovers.
We've always done things on our own, so we really don't know what to look for/what questions to ask.
Also, would you be comfortable talking about large sums of money over Zoom?? That really weirds me out. I'd much prefer a face-to-face meeting for many reasons, but that's probably the number one reason.
Advice?
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04-01-2021, 01:17 PM
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#2
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Thinks s/he gets paid by the post
Join Date: Mar 2013
Location: Southern California
Posts: 3,999
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I think you are over complicating things. If you have an existing Fidelity account, just open an IRA with them. You can do this online without needing to speak with anyone. Once you do this, you can request to roll over the Fidelity 401K to your Fidelity IRA online as well. The whole process took me about 2 days to move the money from 401K to IRA. You will need to choose different funds because some of the funds in your 401K (typically the stable value fund) are not going to be available in your IRA. But most of them will likely be there.
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04-01-2021, 01:26 PM
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#3
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Recycles dryer sheets
Join Date: Mar 2011
Posts: 112
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Congrats on your DH's retirement!
This is a simple process, and won't require you to visit in person.
Step 1 is to open an IRA with Fido, if you don't already have one with them. Once logged into Fidelity.com, select the tab .. Investment Product>Retirement & IRAs - then select the type of Account you want to open (IRA, Roth, Rollover IRA). Once you have created the account..
Step 2 is to fund the account. The website will walk you through this, and if your DH's 401k is linked to the same fidelity.com account you created the IRA with, it is very simple. You will be given the option for a "Cash" transfer or an "in-kind" transfer. It sounds like "in-kind" is the route you are wanting.
That's it.
For reference.. 3-days ago I created an HSA at FIDO. I am transferring HSA funds from another institution, and the funding process was a bit more intensive as I needed to input all the other institution's info. I did all this on fidelity.com, and it took me roughly 6-7 minutes.
Disclaimers..
- I am not advocating for you to move from a 401k to an IRA, I assume you have decided this is the right decision for your situation.
- Personally, I am comfortable doing these sorts of transactions online.
- If you decide to meet someone virtually - I would be more concerned about giving account/login info out virtually, than account values/amounts. While I am sure that this is a sizable transaction (from a monetary perspective), it's a straightforward transfer within the same institution.
- If you decide to go to the Fidelity Store.. I don't think you would necessarily need to meet with a planner. All you are doing is opening an IRA Account and funding that Account with an in-kind transfer from a similar account (pre-tax) within Fido.
__________________
"Porsche and BMW drivers are arrogant." - Carroll Shelby
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04-01-2021, 01:55 PM
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#4
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Thinks s/he gets paid by the post
Join Date: Jul 2009
Location: North Scottsdale
Posts: 1,545
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Really a simple process since you are keeping it all "in the family". Just go to the site and follow the instructions. I did this last year and had zero issues.
__________________
FIRE'D in July 2009 at 51...Never look back!
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04-01-2021, 02:00 PM
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#5
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Recycles dryer sheets
Join Date: Feb 2011
Location: Arlington Heights
Posts: 271
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Quote:
Originally Posted by JoshTrent
Step 1 is to open an IRA with Fido, if you don't already have one with them. Once logged into Fidelity.com, select the tab .. Investment Product>Retirement & IRAs - then select the type of Account you want to open (IRA, Roth, Rollover IRA). Once you have created the account..
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I have a question on this as I may doing the exact thing soon. Although I will most likely call them and walk through the process with them, I have a question related to Rollover IRA vs IRA.
What is the difference?
If I already have an IRA with Fidelity, could I not just put the 401k funds in to the existing IRA? If I don't already have an IRA with Fidelity why would I indicate Rollover IRA vs IRA?
Thanks.
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04-01-2021, 02:01 PM
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#6
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Dec 2014
Location: Huntsville, AL/Helen, GA
Posts: 6,002
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For all practical purposes, the 401k ans Rollover IRA work the same way. The funds you indirectly transfer into FIDO will go into one Money Market IRA account.
Then you will make your decisions on.what accounts you wish to invest in and the amounts. You will sign in and do the processing yourself.
What I like about Fidelity is that they have every kind of available fund, and their computer system is so easy to work. I also like their whole list of available account statistics are readily available so you can pick the best funds that suit your needs.
I have not made any withdrawals in a couple of years, and even then I was really using them to forward my federal and state income taxes. RMDs are coming next year.
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04-01-2021, 02:16 PM
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#7
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Dec 2014
Location: Huntsville, AL/Helen, GA
Posts: 6,002
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First of all, is the ex-MegaCorp making you move out of their 401k account? If not, leave it where it ish long as you have the fund(s) you want the money in.
My MegaCorp required me to take the funds out of their program upon termination. I assume they had been paying some of the transaction charges and fees.
Often 401ks will be limited to certain funds that are not necessarily their best performers. When I went to the IRA Rollover, my ROE improved because I could then buy and sell as I pleased.
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04-01-2021, 02:49 PM
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#8
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Aug 2004
Location: Laurel, MD
Posts: 8,327
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Quote:
Originally Posted by SoReady
I have a question on this as I may doing the exact thing soon. Although I will most likely call them and walk through the process with them, I have a question related to Rollover IRA vs IRA.
What is the difference?
If I already have an IRA with Fidelity, could I not just put the 401k funds in to the existing IRA? If I don't already have an IRA with Fidelity why would I indicate Rollover IRA vs IRA?
Thanks.
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That's a great question. My understanding is that a rollover IRA (sometimes called conduit IRA) is an IRA that holds funds rolled out of an employer plan. In some cases you can roll these plans into a new plan if your new employer's plan accept rollovers. I am skeptical as to how well this is enforced. I now have a Rollover IRA at Fidelity that contains funds from my 401k but also funds rolled over from a tIRA.
__________________
...with no reasonable expectation for ER, I'm just here auditing the AP class.Retired 8/1/15.
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04-01-2021, 03:02 PM
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#9
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Aug 2004
Location: Laurel, MD
Posts: 8,327
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Quote:
Originally Posted by always_learning
So, DH retired last year (yay!) and we're wanting to move his 401k to IRAs. The 401k is administered by Fidelity and we're planning to just leave everything with them, so I'm guessing that will simplify the process. Hopefully that's not naive of me.
What is our first move here? We have an office about an hour away but it looks like they aren't doing in-person visits. How do we get started? If I go to my local office's page, there are tons of folks to choose from, so do I just pick one and go from there? If so, and if we don't need investing advice, does it matter what their credentials are? How do we choose? We don't need investing advice, just someone experienced in these rollovers.
We've always done things on our own, so we really don't know what to look for/what questions to ask.
Also, would you be comfortable talking about large sums of money over Zoom?? That really weirds me out. I'd much prefer a face-to-face meeting for many reasons, but that's probably the number one reason.
Advice?
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I agree with everyone else. This is super easy, especially if you stay with Fidelity. I have done this myself. I would just call them up. The one thing to consider is if you want to map your funds to similar funds or do you want to adjust your allocation. Also, if you have a stable value fund in the 401k, maybe you could keep it open to maintain access even though you cannot add funds. Then move your stock and bond funds to the IRA..
__________________
...with no reasonable expectation for ER, I'm just here auditing the AP class.Retired 8/1/15.
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04-01-2021, 03:26 PM
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#10
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Thinks s/he gets paid by the post
Join Date: Jul 2012
Location: Texas
Posts: 3,024
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When working, Fidelity managed Megacorp's 401K, pension, and health insurance. So a month or so before I retired, I was assigned a "Fidelity Retirement Specialist." She was a Fidelity employee who worked very closely with Megacorp HR and retirees to coordinate retirement benefits decisions. She was extremely knowledgeable about Megacorp's specific programs.
We spoke several times about what I wanted to do in terms of the 401K-to-IRA, various pension choices, and retiree health insurance choices. She answered all my questions. Once I communicated my decisions, dates, etc, she did everything. She sent lots of emails explaining what I would see online and when, as well as any action I needed to take.
So for me, this process was super simple. But I assume that person's services were part of the deal Megacorp struck with Fidelity as part of managing all those services. Obviously part of her role was also to steer me to Fidelity with the 401K money. But I had already made that decision so I didn't require much "steering."
__________________
Retired at 52 in July 2013. On to better things...
AA: 85/15 WR: 2.7% SI: 2 pensions, SS later
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04-01-2021, 03:29 PM
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#11
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Thinks s/he gets paid by the post
Join Date: Mar 2009
Posts: 2,985
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Being a rather large amount, in 2016 I visited my nearby Fido office to experience the transfer in kind of my 401k to a Fido IRA. This was the only time I asked for some handholding and it was flawless. By the time I got home everything had transferred over with no market exposure.
__________________
Took SS at 62 and hope I live long enough to regret the decision.
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04-01-2021, 06:24 PM
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#12
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Recycles dryer sheets
Join Date: Feb 2017
Posts: 267
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Quote:
Originally Posted by Ready
I think you are over complicating things. If you have an existing Fidelity account, just open an IRA with them. You can do this online without needing to speak with anyone. Once you do this, you can request to roll over the Fidelity 401K to your Fidelity IRA online as well. The whole process took me about 2 days to move the money from 401K to IRA. You will need to choose different funds because some of the funds in your 401K (typically the stable value fund) are not going to be available in your IRA. But most of them will likely be there.
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It's hard to not overthink things when you honestly don't know where to start. LOL. We don't have an account with Fido other than the 401k, but it sounds like that's not an issue at all.
Thanks for your post. It helped!
Quote:
Originally Posted by JoshTrent
Congrats on your DH's retirement!
This is a simple process, and won't require you to visit in person.
Step 1 is to open an IRA with Fido, if you don't already have one with them. Once logged into Fidelity.com, select the tab .. Investment Product>Retirement & IRAs - then select the type of Account you want to open (IRA, Roth, Rollover IRA). Once you have created the account..
Step 2 is to fund the account. The website will walk you through this, and if your DH's 401k is linked to the same fidelity.com account you created the IRA with, it is very simple. You will be given the option for a "Cash" transfer or an "in-kind" transfer. It sounds like "in-kind" is the route you are wanting.
That's it.
For reference.. 3-days ago I created an HSA at FIDO. I am transferring HSA funds from another institution, and the funding process was a bit more intensive as I needed to input all the other institution's info. I did all this on fidelity.com, and it took me roughly 6-7 minutes.
Disclaimers..
- I am not advocating for you to move from a 401k to an IRA, I assume you have decided this is the right decision for your situation.
- Personally, I am comfortable doing these sorts of transactions online.
- If you decide to meet someone virtually - I would be more concerned about giving account/login info out virtually, than account values/amounts. While I am sure that this is a sizable transaction (from a monetary perspective), it's a straightforward transfer within the same institution.
- If you decide to go to the Fidelity Store.. I don't think you would necessarily need to meet with a planner. All you are doing is opening an IRA Account and funding that Account with an in-kind transfer from a similar account (pre-tax) within Fido.
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Thanks for this. Because of your post, I went back to FIDO's site (hadn't been there in several months) and saw that they had some really good info, now that I know what I was supposed to look for. They even mention how easy it is if they already manage the 401k.
We will be calling them, though, because there is company stock/NUA involved so we need to know how to handle that. I also noticed that they have a great info page on NUA which wasn't there the last time I poked around (they posted it the end of Jan 2021).
Quote:
Originally Posted by RockyMtn
Really a simple process since you are keeping it all "in the family". Just go to the site and follow the instructions. I did this last year and had zero issues.
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Fantastic. This is all making a daunting process seem to be a much simpler task than I had feared it would be.
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04-01-2021, 06:30 PM
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#13
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Recycles dryer sheets
Join Date: Feb 2019
Posts: 384
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Quote:
Originally Posted by SoReady
I have a question on this as I may doing the exact thing soon. Although I will most likely call them and walk through the process with them, I have a question related to Rollover IRA vs IRA.
What is the difference?
If I already have an IRA with Fidelity, could I not just put the 401k funds in to the existing IRA? If I don't already have an IRA with Fidelity why would I indicate Rollover IRA vs IRA?
Thanks.
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Having just asked this question (401K to rollover IRA is in process right now), my understanding is that like a 401K plan, a Rollover IRA has certain protections in the event of filing for bankruptcy that a standard IRA does not have. That is the only real difference.
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04-01-2021, 06:38 PM
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#14
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Recycles dryer sheets
Join Date: Feb 2017
Posts: 267
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Quote:
Originally Posted by Bamaman
For all practical purposes, the 401k ans Rollover IRA work the same way. The funds you indirectly transfer into FIDO will go into one Money Market IRA account.
Then you will make your decisions on.what accounts you wish to invest in and the amounts. You will sign in and do the processing yourself.
What I like about Fidelity is that they have every kind of available fund, and their computer system is so easy to work. I also like their whole list of available account statistics are readily available so you can pick the best funds that suit your needs.
I have not made any withdrawals in a couple of years, and even then I was really using them to forward my federal and state income taxes. RMDs are coming next year.
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Thanks, Bamaman. I haven't used their site much but it does seem user-friendly. I'm sure I'll be intimately acquainted with it when all is said and done. LOL.
Quote:
Originally Posted by Bamaman
First of all, is the ex-MegaCorp making you move out of their 401k account? If not, leave it where it ish long as you have the fund(s) you want the money in.
My MegaCorp required me to take the funds out of their program upon termination. I assume they had been paying some of the transaction charges and fees.
Often 401ks will be limited to certain funds that are not necessarily their best performers. When I went to the IRA Rollover, my ROE improved because I could then buy and sell as I pleased.
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No, the ex-Mega isn't requiring it, but we want to take advantage of NUA on the company stock, so that mandates liquidating the account. Also, we haven't been happy with their fund offerings as they have under-performed what we've accomplished outside the 401k.
I'm curious, though... why would you recommend leaving the money in there?
Quote:
Originally Posted by jazz4cash
I agree with everyone else. This is super easy, especially if you stay with Fidelity. I have done this myself. I would just call them up. The one thing to consider is if you want to map your funds to similar funds or do you want to adjust your allocation. Also, if you have a stable value fund in the 401k, maybe you could keep it open to maintain access even though you cannot add funds. Then move your stock and bond funds to the IRA..
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Thanks. It's good to hear from those who have done it themselves. We're wanting different funds than what we're invested in right now, so we'll be moving to mostly new things. As I mentioned to Bamaman above, we're wanting to take advantage of company stock and NUA, so we'll be emptying the 401k.
Quote:
Originally Posted by Cobra9777
When working, Fidelity managed Megacorp's 401K, pension, and health insurance. So a month or so before I retired, I was assigned a "Fidelity Retirement Specialist." She was a Fidelity employee who worked very closely with Megacorp HR and retirees to coordinate retirement benefits decisions. She was extremely knowledgeable about Megacorp's specific programs.
We spoke several times about what I wanted to do in terms of the 401K-to-IRA, various pension choices, and retiree health insurance choices. She answered all my questions. Once I communicated my decisions, dates, etc, she did everything. She sent lots of emails explaining what I would see online and when, as well as any action I needed to take.
So for me, this process was super simple. But I assume that person's services were part of the deal Megacorp struck with Fidelity as part of managing all those services. Obviously part of her role was also to steer me to Fidelity with the 401K money. But I had already made that decision so I didn't require much "steering."
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I know DH had someone he spoke to but I'm not sure who it was. I'll have to see if it was a FIDO person or someone at the ex-Mega.
Quote:
Originally Posted by foxfirev5
Being a rather large amount, in 2016 I visited my nearby Fido office to experience the transfer in kind of my 401k to a Fido IRA. This was the only time I asked for some handholding and it was flawless. By the time I got home everything had transferred over with no market exposure.
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This was my first choice, but FIDO isn't doing in-person meetings right now, which was why I asked here for advice. Happily, it looks like it will just take a phone call, a few questions with a "Rollover Specialist" (according to their website), and we'll be able to do it all online. If the in-person meeting was an option, I'd definitely do that, though, as I prefer the face-to-face interaction for something like this.
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04-01-2021, 07:27 PM
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#15
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Moderator
Join Date: Nov 2014
Posts: 9,171
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Quote:
Originally Posted by always_learning
I'm curious, though... why would you recommend leaving the money in there?
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I was going to recommend you consider keeping your 401K. IF, it has a particular account that you can’t get otherwise. DW has retained her 401K because they have a stable fund that pays 3% guaranteed. If you don’t have anything like that then it’s most likely not worth keeping the 401K.
Also, not sure of your age, but some 401K’s let you access money at 55 penalty free. That is another reason some leave their money with the employer.
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