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Re: What do you do with your 401(k) when leaving a job?

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I also had several accounts, a couple of 403b's and a 401 k. I rolled one of the 403's into an annunity with a lifetime 7% return guarentee and the 401 into an IRA. 

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Re: What do you do with your 401(k) when leaving a job?

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I know the IRS doesn't care where your withdrawel comes from.  I do care that I can't access my own money.  Right now I have 4 accounts like that.  You don't realize they are trying to lock your money in forever.

 

How can you deturmine your MRW when you don't know how much money you have?  You need to go through your former employer to do anything who may have gone out of business. I believe you are very foolish leaving your money in your old 401k.

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Re: What do you do with your 401(k) when leaving a job?

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That was an informative article.

 

The problem with ALL brokerage firms and 401k is you pay additional hidden costs for mutual fund and bond transactions. 

 

The good part is 401ks have to disclose all your costs in a perspectus they are required to give you.  In 30 years I have never seen one.  I don't even get yearly statement from most of my 401ks. I wll start to make a stink.  I can't get my money out of some of my 401ks.  I will now try to use that they are breaking the law to pry that money out of them.  I will report each one to the The U.S. Department of Labor . 

 

https://www.investopedia.com/articles/personal-finance/061913/hidden-fees-401ks.asp

 

 

See how much fun they have with the government after them!

 

Try to read financial articles to stay informed.  Investopedia is a great bang for the buck!

 

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Re: What do you do with your 401(k) when leaving a job?

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Message 4 of 10

Maybe it depends. This is just from my personal experience, I'm not a financial person.

 

If a person is not retiring, they might be able to roll the old 401k into the new employer's 401k if they believe it is a good one. That way, they keep their money in one place. But if a person is nearing retirement, it might be a good idea to roll the 401k into an IRA and have it set up an running. If retiring, then best to roll it over to an IRA upon leaving the company. You can get the paperwork from your employer, or it's probably available on line. (If you have an HSA, you probably need paperwork for that, too.)

 

I set up my IRA before I retired by rolling over a 401k from one employer, then continued working at new job with a new 401k. Then when I retired, I rolled it over to the IRA already established.

 

Everyone has different circumstances, so it's a good idea to consult with a financial adviser, whether private or with the brokerage firm. I used the brokerage firm adviser because private services are expensive, and typically only cater to high end accounts. Do a little homework and check out the brokerage firms and / or ask your friends for referrals. If by chance your employer has used a brokerage firm that you like, then it's even easier to make the transition.

 

Determine if you want to manage the account yourself, or have the brokerage firm manage it for you, or go with an index fund, or have a mix. In any case, you want to know what fees are involved. You may also want to ask about how to set up accounts with regards to any future tax liabilities. Also, your brokerage adviser should be able to help you get your money rolled over from any older 401k or other investment accounts. 

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Re: What do you do with your 401(k) when leaving a job?

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Message 5 of 10

@jimthehook , I assumed that. 

 

The issue is you need to know at least what the IRS knows.  I am learning how fool harty kicking the can down the road for nasty 401ks. Some 401ks don't send annual statements.   Getting money out of these old accouts is nearly imposible.  They are hoping you never get your money out.   All the contacts for the employer for the 401k I was working on today are no longer valid.  Another, the company went out of business. I don't know how I can get the money out of that one.  They are going to wind up is the unfound money you get adds for but can't actually get you hands on the money. 

 

My advice is get your money out of your old 401k unless it is something special.  I have never seen any 401k I thought was special and I have seen quite a few.

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Re: What do you do with your 401(k) when leaving a job?

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Dont trust your ex employer with your savings.  Transfer it to an IRA with a reputable company like Fidelity or American Funds.

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Re: What do you do with your 401(k) when leaving a job?

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Just an FYi, you don't have to take your RMD from all your accounts. Once you have the total RMD number you can take it from one of your accounts. 

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Re: What do you do with your 401(k) when leaving a job?

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Message 8 of 10

What you don't want is a dozen or so small 401ks.  It will become a nighmare. I am trying to move the little ones I left behind because they were too hard to transfer.  That is like pulling teeth.  I might get one or 2 done in a year thay are so painfull.  For 2-3k I ned to fill out 20 pages of paperwork then jump through 20 hoops.   This is a very effective way of keeping your money against your will but it is legal.  After you die you heirs will need lawyers to fill out that paper work so I am doing these now, slowly.  I am not retired just yet so I have time but at 70 not that far away making the MRWs will be terrible.  Dealing with those hard to deal with companies every year for the MRW minimum required withdrawl will be punishing but not as bad as having the IRS after you.  Keep them together!  

 

If you don't have a broker you trust you can move it over to a current 401k. 

 

I always try put it into an IRA.  I have had a long string of employers because I work contracts.  You make good money while you are working but you new to find a new job when the contract expires.   

 

I have gone though 4 borokers.  What I have seen in my life is the persons who 'play the market' always get beat up up into their 50s.  After a while you have made enough mistakes to get smart.  They always did well in their 60s and up until they died.  That is what I am doing and my wife has just followed my lead.  She thinks the market is wonderful!  I lost $300k to get this smart but it paid off.  I will retire this year and I never thought I would have this much money.  I was in 100% stocks until 65.  Now I am 50/50, retirement mode.

 

If you are in your 50s stay in your 401k.  You can't afford to make mistakes.  You want half in bonds and 1/4 in a large cap index and 1/8th in a full market index and 1/8 in a small cap index.  Large cap are the least likely to go belly up.  Last century, you were supposed to go to all bonds when you retired but those people didn't make any money.  They didn't lose money other than what they spent but they continually needed to take from their principle.  They are afraid they will run out of money even though some of those were Drs and retired with lots of cash.

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Re: What do you do with your 401(k) when leaving a job?

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As of the moment, I've left mine with my former employer.  I also have an investment account IRA & 401(k) with my most recent employer.  I'm also interested in learning of others' experiences.    

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What do you do with your 401(k) when leaving a job?

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Do you transfer it to your new employer? Roll it into an IRA? Or keep it where it is?

 

Here are some things to consider when deciding: https://www.aarp.org/retirement/retirement-savings/info-2019/old-401k-accounts.html

 

Let us know what you've done in the past.

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