Is there any advantage to rolling my 401k into a rollover IRA instead of my existing traditional IRA?
yogidog asked:
I have an existing traditional IRA and two 401k’s from previous companies. I’d like to consolidate accounts.
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I have an existing traditional IRA and two 401k’s from previous companies. I’d like to consolidate accounts.
Is there reason I should roll the 401k’s into a rollover IRA instead of directly into my existing traditional IRA?
Are there any consequences regarding maybe later converting the IRAs to Roth IRAs later?
February 10th, 2009 at 7:43 pm
The only thing you want to treat differently is any company stock from your 401k. Other than that it really does not matter where you put it and there is a lot to be said for having it all in one place.
February 13th, 2009 at 4:11 am
The traditional IRA was funded with after-tax money. So, when you withdraw at retirement, you pay taxes on only the added value of the investment, not the money you initially put in.
You create a rollover IRA because this will have your 401K money which is pre-tax money. When you withdraw, you pay income taxes on all of it.
I’m going through this now, so I’ve done all the research on it.