Long time no post!
I’ve been meaning to rollover my former employer’s 401(k) account for a while now… 1.5 years after I left the job. On Thursday, I went to an event at called “Investing Better” where I hoped to learn more about strategies and literally invest better (it didn’t happen) but it did spark me to take action to consolidate my multiple accounts.
For transparency, with my old employer I have both a traditional 401(k) and the Roth 401(k). I decided to contribute to both plans because I figured it doesn’t hurt to put more money into retirement. My thought process was that I was in my lowest tax bracket of my life, so I can do Roth. I put money into traditional since that was the default option . I also opened up a separate Roth IRA a few months later, because why not? I was 22 and with so many years to grow…
Which Broker to Use?
Thanks to Nerd Wallet, who put together a great summary table here. They compared the brokers, what it’s best for, cost of making trades, and current promotions.
I am looking for something that is low-cost, so I am deciding between Fidelity and Vanguard thanks to Nerd Wallet.
Fidelity has this amazing promotion going on to match 1-10% IRA contributions for current year + next 2 years depending on how much is deposited. To much sadness, I did not qualify since “direct rollovers from a 401(k) are not eligible.”
Vanguard was my next choice and the broker I had in mind already but needed some extra reassurance. It also helps that my current employer switched to Vanguard so I already have funds here.
Rollover or Convert?
The next hurdle is figuring out if I wanted to convert my Traditional 401(k) portion as well. Note that this is a very personal choice!