401k RolloverA 401k rollover is not as hard as you think, but there is work involved. If you are going to leave your job one of the things you have to consider is taking your 401K plan with you. But, before you do, it is always important to keep your account information in a safe place where you can refer to it immediately. Keep your quarterly statements filed away in a file cabinet and make sure you beneficiary information is up to date. The easiest way to a 401k rollover is to open an IRA account with Vanguard or Fidelity Investments. They are two of the best mutual funds in the industry and their fees are very cheap. Although you can rollover your existing plan to your new employer, I personally do not like the idea. I'll tell you why, it’s easier for you to manage your accounts on your own as long as you select the right funds. One reason is that you might not stay at your new job long then you're back rolling over your retirement account yet again. If you open an IRA with Vanguard or Fidelity you have one account with them and a new 401k plan with your new job. If you decide to leave or you're let go, you can easily get this done and transfer the money to your IRA which is always with you. Call Vanguard or Fidelity and speak to one of their account representatives. They are excellent at what they do and they’ll help you make the transition as painless as possible. Once you open an account which can be done online as well. You can get in contact with your current employer to start the paper work. Your benefits department administrator should know what you need to do. Most likely, you'll need to fill out an application requesting the rollover. One of the options is for them to send you the check, which is what I did, but the check is made out to the new IRA account you opened with Vanguard or Fidelity. When you opened the account, Vanguard/Fidelity will give you the information you'll need to fill out the withdrawal application with your current employer. Once you get the check in the mail, you'll need to send it to your IRA account. That's it! It's not that hard, but keeping your accounts with one company such as Vanguard is the way to go especially if you and your spouse are both leaving and starting new jobs. It makes it easier to manage as well. You can also link accounts to your checking account to deposit money into different funds as you like. That's a benefit that you won't have with your 401K plan. Vanguard and Fidelity offer funds that are much better and broad than your employer. They have lots and lots of funds to pick from that makes it easier for you to choose from. A 401k rollover does not have to be hard, with proper planning and organization is a lot easier than you think. Keep saving!
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