Quote:
Originally Posted by Cornstock
Agreed, I strongly advise against keeping inactive 401ks from former employers and old IRAs separate. When you consolidate into one IRA you can manage things more easily, and don't need to worry about being charged different fees at 3 different places. You have a full buffet of options when you are in control.
You have the choice to roll these into your current 401k, but this is not advisable because you are limited to whatever funds that company offers, and they usually have higher expense ratios than if you have it elsewhere. A best case scenario would be that they do have a terrific choice of funds that match your objectives, but they are still more expensive annually.
Additionally, when you retire and a required to take Required minimum distributions, having to withdraw from 3 separate places complicates the calculation. If you only have 1 merged account, they will tell you exactly what you need to withdraw, so you don't run the risk of having an insufficient RMD penalty.
|
Best thing that ever happened to me financially was getting laid off. I took my 401k, rolled it into a self directed IRA and bought 2 beach condos that I rent out.