How do you transfer a 401k to an IRA?

By Financial Advisor Hans Smith

What should you do with your 401k when you change jobs?

After leaving a job, you have the option to complete a "direct rollover" of your workplace 401k or 403b into an Individual Retirement Account (IRA). This is something that we can assist with, as it typically requires some light paperwork or a phone call.

401k and 403b "direct rollovers" are not taxable events, and there are no penalties if executed correctly. You will continue receiving the benefits of tax-deferral in your personal IRA.

One important advantage of a personal IRA is having increased investment flexibility when compared to a workplace retirement plan. Many 401k and 403b plans offer a limited menu of mutual funds, and sometimes do not have the investment options available to build a truly diversified low-cost portfolio.

Mutual funds inside of 401k and 403b plans often have high expense ratios associated with them. This is on top of record keeping and administrative fees that grind away at investment returns over time. Transferring assets from a 401k into a personal IRA gives you the ability to invest in a variety of low-cost diversified index funds, and eliminates record keeping and administrative fees.

A personal IRA can be a great place to consolidate retirement assets every time you switch jobs. Consistently rolling over your 401k and 403b plans into a single IRA reduces unnecessary financial account complexity over time.1

How we can help:

One Day In July can manage your personal IRA using a variety of low-cost index funds. We will help you build a portfolio that matches your goals and personal risk tolerance. Client portfolios are constructed using diversified low-cost index funds produced by Vanguard and iShares.

Individual Retirement Accounts that we manage for clients are held at Charles Schwab. Clients have online access to their Schwab accounts, and we are able to make investment selections for you using the Schwab Independent Advisor Platform.

Contact us for help moving a prior workplace 401k, 403b, or 457b plan to an IRA:
Hans Smith | (802) 829-6899 |

1 The decision to rollover a workplace retirement plan into a personal IRA account should be considered on a case by case basis, as it may not always be the most prudent choice, depending on the specific facts and circumstances of the case.

Get Started Today.

Please enter a first name.
Please enter a last name.
Please enter an email address.
Please enter a ZIP code.
1000 characters remaining
Please enter a message.
How Are We Different
Understanding Your Financial Statement
Articles on Investing
Investing with Low Cost Index Funds
Pay Yourself First
Why Use a Fiduciary Financial Advisor?
Financial Planning
Quarterly Booklets
Simple, Low Investment Fees
Investor Resources
Investment Tools
Financial Firm Comparison
The Investment Process
One Day In July in the Media
Local Financial Advisor
How to Switch Financial Advisors
Frequently Asked Questions
Book Recommendations
Types of Investors
One Day In July Careers
Prospect Booklet
Square Mailers
Fee Calculator
Types of Accounts We Manage
Options for Self-Employed Retirement Plans
Saving Strategies
What to do When Receiving a Pension
Investment Tax Strategy: Tax Loss Harvesting
Vermont Investment Management
How to Invest an Inheritance
Investment Tax Strategy: Tax Lot Optimization
Vermont Retirement Planning
How to Make the Best 401k Selections
Investing for Retirement: 401k and More
Vermont Wealth Management
How to Rollover a 401k to an IRA
Investing in Bennington, VT
Vermont Financial Advisors
Investing in Albany, NY
Investing in Saratoga Springs, NY
Should I Try to Time the Stock Market?
Mutual Funds vs. ETFs
The Cycle of Investor Emotion
Countering Arguments Against Index Funds
Annuities - Why We Don't Sell Them
Aim for Average
How Financial Firms Bill
Low Investment Fees
Understanding Fixed Income: Interest Rate Risk
Investing in a Bear Market
Investing in Gold
Is Your Investment Advisor Worth One Percent?
Active vs. Passive Investment Management
Investment Risk vs. Investment Return
Who Supports Index Funds?
Articles by Dan Cunningham
Does Stock Picking Work?
The Growth and Importance of Female Investors
Behavioral Economics
The Forward P/E Ratio

Vergennes, VT Financial Advisor

206 Main Street Suite 20

Vergennes, VT 05491

(802) 777-9768

Wayne, PA Financial Advisor

851 Duportail Rd 2nd Floor

Chesterbrook, PA 19087

(610) 673-0074

Burlington, VT Financial Advisor

77 College Street #3A

Burlington, VT 05401

(802) 503-8280

Middlebury, VT Financial Advisor

79 Court Street, Suite 1,

Middlebury, VT 05753

(802) 829-6954

Hanover, NH Financial Advisor

26 South Main Street #4

Hanover, NH 03755

(802) 341-0188

v 2.4.46 | © One Day In July LLC. All Rights Reserved.