Rolling a 401(k) Over to a Fidelity IRA
If you have a 401(k) plan from a previous employer and aren't sure what to do with it, one option is to move it to Fidelity, where it can be converted into an IRA. This can be done without incurring taxes or penalties. Here’s a simple guide to help you through the process.
Moving a 401(k) Plan to Fidelity
Before starting the rollover process, you might want to
watch a short video on Fidelity’s website that explains the steps involved. The video provides useful information, such as deciding whether to convert your old 401(k) into a Traditional or Roth IRA, working with your previous plan administrator, and choosing investments for your new IRA. If you can’t find the video on Fidelity’s website, simply search for “Fidelity 401(k) rollover” online.
When you’re ready to start the rollover, the first step is to open a Fidelity IRA. You can do this easily on their website by clicking the “Start Rollover Now” button on the 401(k) rollover page mentioned earlier. If you’re already a Fidelity customer, log in to your account. If you’re new to Fidelity, provide your name and email to get started. You’ll need to enter your personal information, such as your address, Social Security number, and details about your old 401(k) plan.
Typically, a standard 401(k) plan is converted into a Traditional IRA, where withdrawals are taxed. Contributions to both a Traditional 401(k) and a Traditional IRA are tax-deductible. If you have a Roth 401(k), it will be moved into a Roth IRA, where withdrawals are tax-free since contributions were already taxed. If you have any questions, Fidelity has specialists available to assist you at 1‑800‑343‑3548. You can also use their online chat or visit one of their over 180 locations in the U.S.
IRA Resources on Fidelity's Website
Fidelity’s website offers a wealth of resources for those managing their own retirement. There are videos, articles, and self-guided courses covering topics like required minimum distributions, the impact of inflation on retirement savings, IRS rollover rules, and more. There are also articles on estate planning and inheritance. Fidelity provides calculators, such as one for required minimum distributions and a strategy evaluator for finding income-generating investments. Additionally, there’s an online tool to help you create a retirement plan by entering information like your retirement age, income, current savings, and expected years in retirement. The tool then estimates whether you’re saving enough and, if not, how much more you need to save each month.
Investment Advice and Portfolio Management From Fidelity
If you’re not confident in managing your own investments, Fidelity offers several options for assistance. You can get investment advice by calling Fidelity or visiting one of their branches. Alternatively, you can let Fidelity manage your account for you. The most affordable option is Fidelity Go, which invests in passively managed funds and costs 0.35% annually with a $5,000 account balance. More comprehensive services are available at higher costs, up to 1.7%, and include investments in stocks and actively managed funds.
Top Alternatives
Fidelity 401K To IRA Rollover Summary
If you have an old 401(k) plan and aren’t sure what to do with it, rolling it over to Fidelity (read Fidelity IRA review) is a smart move. Contact Fidelity for help with the process.
Another popular and cost-effective option for rolling over a 401(k) into an IRA is
Charles Schwab.
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Updated on 7/2/2024.
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