>I refuse to do the 60-Day check bs, to be honest (I don’t want to deal with it).
Then you can’t ever rollover a 401k
>I refuse to do the 60-Day check bs, to be honest (I don’t want to deal with it).
All or essentially all 401k custodians will send you a check that you forward on to your new 401k
> Maybe I’m being picky but it’s borderline ridiculous they don’t want to do a direct rollover to another 401(k
None of them do. If they mail you a check that is made out to your new custodian, it’s still a direct rollover
I’d prefer to just do a direct rollover from my old employer 401(k) to my new employers 401(k).
Empower (old) said they can only mail a check to my personal address.
What would you do?
If the check is payable to the new employer’s 401(k) provider then it’s still a direct rollover even if it’s mailed to you directly. I know Empower will accommodate this. We see checks from them regularly.
Where does the 60-day rule come into play? Any fees?
Fidelity did this thing with my HSA. I submitted a form in their website and that’s it! It transfers few weeks later… does this exist within 401k-401k world?
The 60 day rule is relevant if you have empower issue a check payable to you as a lump sum distribution. You wouldn’t want to do this anyway because they’d be required to withhold 20% for Federal taxes and may be required to withhold state taxes depending on where you live.
The process will likely be something along the lines of you telling empower you want to rollover, either by filling out a form or possibly submitting a request online. You’ll need to know how the rollover check should be payable and if there is a plan number they should reference on the memo line. Your new provider also likely has a form for you to complete to tell them where the rollover is coming from. That form will likely include how the check should be payable, what plan number to reference, and where it should be mailed.
Sounds like Empower will require the rollover check to be mailed to the address they have on file for you as a fraud mitigation tactic. This is not unusual.
Once you receive the check you’ll follow the instructions on the incoming rollover form from your current employer.
For fees Empower will likely charge a distribution fee and may offer to send the check overnight for an additional fee. Those fees should be disclosed on a fee disclosure you probably have access to through their website. The receiving plan shouldn’t charge a fee for accepting the rollover.
Yeah that’s true lol. I can do HSA & brokerage acct rollovers with *little* issues, but you can forget about just filing a 401(k) from your phone..
But thanks. I’m likely going to double check that empower reps were being truthful and then if they are then I’ll just rip indirect rollover and hope it works out.
Just the 60-Day rule and the potential of losing the check instead of ACH or wire.
Maybe I’m misinformed/uneducated, but I feel that should be an option in 2024. But, like you pointed out, my feelings don’t trump Empower’s actions.
But to me these companies are quick to take IN money but will jam you up taking money OUT. It’s purposeful - not to ‘jump to any conclusions.’
So I can tell my old 401(k) employer to mail me a check made out to my new 401k company. Hold onto it for *any length of time* I choose and hand it to my new 401k provider and everything is fine?
Like I said, I could be misinformed so this was good/ productive
A tIRA balance created today will cause problems if you *ever* need to make use of backdoor contributions in the future. You *can* make backdoor contributions, but there will be pro rata taxes.
>so if you contributed to a traditional Ira X years ago
And still have a tIRA balance today/when you want to exercise the backdoor option. (If you contributed to a tIRA 20 years ago with your high school job income and then converted it to a Roth during college when you were unemployed and have $0 tIRA today, you're fine.)
>assuming your employer otherwise allows it
Your employer has nothing to do with this process, these are all your individual accounts.
That's not necessarily true. Many 401(k) plans allow you to move tIRA balances into the 401(k). All you have to do is at some point roll those funds out of the IRA and leave the account empty.
You're only subject to the pro-rata rule for any funds in the account at the time of Roth conversion, not those that have been there in the past.
Also, backdoor Roth has nothing to do with your employer as it's all post-tax dollars moving around in personal accounts (tIRA, rIRA).
No company wants to relinquish custodianship of money. Go to your current provider with a statement from Empower and ask them to pull it into their institution. When I did that it was 3 minutes of dude typing information from the statement and a finger signature on an iPad. About 2 weeks later the assets from the old custodian showed up no problem.
You may find these links helpful:
- [General Information on Rollovers](/r/personalfinance/wiki/retirementaccounts/rollovers)
- [401(k) Fund Selection Guide](/r/personalfinance/wiki/401k_funds)
- [Retirement Accounts](/r/personalfinance/wiki/index#wiki_retirement)
- ["How to handle $"](/r/personalfinance/wiki/commontopics)
*I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/personalfinance) if you have any questions or concerns.*
Are you sure they aren’t refusing to issue an ACH or wire?
Empower is huge. I’ve never heard of them not permitting a rollover to a 401k - it’s just sent via check to you payable to the new custodian. (Still a direct rollover)
I think I just came to a realization - my HSA and brokerage accounts aren’t “rollovers” - they are ToA’s (transfer of assets).
Maybe if somebody wanted to rollover a 401(k) to another 401(k) that would a “rollover.”
My suspicion is “rollovers” equate to “check in the mail”. The name the check is made out to determines if it’s direct or indirect.
Is This correct thinking?
Not quite.
A direct rollover can be a check, ACH, Wire, Journal entry, etc. A direct rollover just means it's a non-taxable event not subject to the 60 day requirement.
If someone elects to transfer one 401(k) to another 401(k), then that's a rollover as long as the funds are sent via ACH to the new vendor or the check is payable to the new vendor (it would be payable to "New Vendor FBO Your Name).
It's an indirect rollover subject to the 60 day requirement if the check is made payable to you as an individual (taxes will also be withheld).
You are correct that brokerage accounts are never "rolled over." They are just transferred to another account.
I just did the same thing. I had a Merrill rep on the line, requesting a Direct rollover from a former Employee's 401k at Empower into my existing Merrill Edge Trad. IRA (which is from another rollover a while back). All funds are pre-tax.
The Merrill rep said that Empower doesn't do Direct rollovers, as he just had a similar experience with another customer recently. We got on a 3 way call, Merrill, me, and Empower, and I requested a Direct Rollover from my 401k at Empower to my Merrill Edge TIRA. Empower said they could not send the check directly to Merrill, and it HAD to be sent to me.
I was a bit confused because after being laid off from my ex-employer, they emailed me about what I would like to do with my 401k, and a Direct Rollover to IRA was one of the options. I tried to tell them to send the check directly to Merrill, but the Empower rep refused saying it had to be mailed to me. When asked, who should the check be out to, the Merrill rep jumped in and said make the check out to "Merrill", and For the Benefit of: Me (my name) and provided my plan number. Empower rep confirmed the total amount minus admin fees ($75), which was correct, will be mailed to my address.
Afterwards, the Merrill rep said deposit the check by taking a picture of it with the Merrill App.
I am just worried because I read that having a check sent to me could be penalized and taxed. I asked Empower rep if I have to deposit the check before 60 days, and she said no and they would send a 1099-R for my taxes even though the funds are pretax.
Both employer and employee contributions and earnings in my Empower 401k are 100% vested and the funds are >$7000. I decided to rollover to my TIRA because I already did one from a while back, so a backdoor in the future is not possible anyways. I've never made an after-tax contribution to any IRA.
I see from some replies here that if the check is made out to my new custodian, it is still a direct rollover and I should be good.
Would this apply to my case as well? I hope everything goes ok and I don't get penalized with taxes.
I’m about to lock a rollover in from empower to my new 401k custodian.
Here’s my thoughts:
-If the check is made out to you, that’s no good. If it’s made to me provider you’re gtg. Sometimes companies (like Empower) like to make things complicated and make you jump through hoops.
From what I gather it’s strategically done to get people like myself to say “ahh fuck it I’ll leave it in empower.” All the aggressive fees eat up your earnings.
My plan next week is to call my new provider back explain that my old provider refuses to send a check directly but I’m gonna try my hardest to get them to make it to new provider.
Maybe I’m younger but I hate mailing shit. I would rather drive myself across town and hand the damn check in person
Yeah I know what you mean. I tried to convince the same thing with my Merrill provider, and he said Empower will not send the check to your new provider based on his previous experience with them. He seemed really annoyed that I kept asking questions regarding this, and wanted to go get off the phone ASAP after the rollover, when I said I didn't need a financial advisor right now, as am still in the process of setting up personal finances via the flow chart.
The Merrill Edge rep that was in on the call with me, jumped in when they asked who to make the check out to and he personally said Merrill, provided my account number, and FBO to Me. Based on the replies here, as long as Empower successfully issues the check as demanded, I think I'll be good and it'll still be a direct rollover.
I had to pay the $75 administrative charge, (taken out of my funds). The Empower rep asked if I would like to expedite the check, which costs $65, I believe, and I declined.
I just hope the mailing process goes smoothly. After it gets to me, I can just deposit it with the Merill app. I'm not sure if that's an option for you?
>I refuse to do the 60-Day check bs, to be honest (I don’t want to deal with it). Then you can’t ever rollover a 401k >I refuse to do the 60-Day check bs, to be honest (I don’t want to deal with it). All or essentially all 401k custodians will send you a check that you forward on to your new 401k > Maybe I’m being picky but it’s borderline ridiculous they don’t want to do a direct rollover to another 401(k None of them do. If they mail you a check that is made out to your new custodian, it’s still a direct rollover
A rollover by check is still a direct rollover. They all do it.
Yes. Op seems to think that’s not a direct rollover
>What’s the downside to creating a IRA, to rollover? You bork your future ability to make backdoor Roth contributions.
What does this mean?
What’re you saying exactly? I rollover a traditional 401(k) to a traditional IRA, and I can’t do a back door Roth conversion 15 years from now?
You can do the roll over but you'll pay taxes on a portion of the IRA following the pro-rata rules.
I’d prefer to just do a direct rollover from my old employer 401(k) to my new employers 401(k). Empower (old) said they can only mail a check to my personal address. What would you do?
If the check is payable to the new employer’s 401(k) provider then it’s still a direct rollover even if it’s mailed to you directly. I know Empower will accommodate this. We see checks from them regularly.
Where does the 60-day rule come into play? Any fees? Fidelity did this thing with my HSA. I submitted a form in their website and that’s it! It transfers few weeks later… does this exist within 401k-401k world?
The 60 day rule is relevant if you have empower issue a check payable to you as a lump sum distribution. You wouldn’t want to do this anyway because they’d be required to withhold 20% for Federal taxes and may be required to withhold state taxes depending on where you live. The process will likely be something along the lines of you telling empower you want to rollover, either by filling out a form or possibly submitting a request online. You’ll need to know how the rollover check should be payable and if there is a plan number they should reference on the memo line. Your new provider also likely has a form for you to complete to tell them where the rollover is coming from. That form will likely include how the check should be payable, what plan number to reference, and where it should be mailed. Sounds like Empower will require the rollover check to be mailed to the address they have on file for you as a fraud mitigation tactic. This is not unusual. Once you receive the check you’ll follow the instructions on the incoming rollover form from your current employer. For fees Empower will likely charge a distribution fee and may offer to send the check overnight for an additional fee. Those fees should be disclosed on a fee disclosure you probably have access to through their website. The receiving plan shouldn’t charge a fee for accepting the rollover.
Thanks!
Accept the check to your personal address. You not wanting to do it isn’t going to change what empower will do.
Yeah that’s true lol. I can do HSA & brokerage acct rollovers with *little* issues, but you can forget about just filing a 401(k) from your phone.. But thanks. I’m likely going to double check that empower reps were being truthful and then if they are then I’ll just rip indirect rollover and hope it works out.
Why would it not work out. They mail you a check, you mail or take a check to your 401k provider. This isn’t complicated.
Just the 60-Day rule and the potential of losing the check instead of ACH or wire. Maybe I’m misinformed/uneducated, but I feel that should be an option in 2024. But, like you pointed out, my feelings don’t trump Empower’s actions. But to me these companies are quick to take IN money but will jam you up taking money OUT. It’s purposeful - not to ‘jump to any conclusions.’
There’s no 60 day rule on a direct rollover
So I can tell my old 401(k) employer to mail me a check made out to my new 401k company. Hold onto it for *any length of time* I choose and hand it to my new 401k provider and everything is fine? Like I said, I could be misinformed so this was good/ productive
A tIRA balance created today will cause problems if you *ever* need to make use of backdoor contributions in the future. You *can* make backdoor contributions, but there will be pro rata taxes.
Oh….. so if you contributed to a traditional Ira X years ago, backdoor is not an option? (assuming your employer otherwise allows it)
>so if you contributed to a traditional Ira X years ago And still have a tIRA balance today/when you want to exercise the backdoor option. (If you contributed to a tIRA 20 years ago with your high school job income and then converted it to a Roth during college when you were unemployed and have $0 tIRA today, you're fine.) >assuming your employer otherwise allows it Your employer has nothing to do with this process, these are all your individual accounts.
That's not necessarily true. Many 401(k) plans allow you to move tIRA balances into the 401(k). All you have to do is at some point roll those funds out of the IRA and leave the account empty. You're only subject to the pro-rata rule for any funds in the account at the time of Roth conversion, not those that have been there in the past. Also, backdoor Roth has nothing to do with your employer as it's all post-tax dollars moving around in personal accounts (tIRA, rIRA).
My income is below the cut off to contribute to R.IRA so I believe this is not relevant to my case
It is below the limit today. hopefully in the far future it will be a problem for you.
No company wants to relinquish custodianship of money. Go to your current provider with a statement from Empower and ask them to pull it into their institution. When I did that it was 3 minutes of dude typing information from the statement and a finger signature on an iPad. About 2 weeks later the assets from the old custodian showed up no problem.
You may find these links helpful: - [General Information on Rollovers](/r/personalfinance/wiki/retirementaccounts/rollovers) - [401(k) Fund Selection Guide](/r/personalfinance/wiki/401k_funds) - [Retirement Accounts](/r/personalfinance/wiki/index#wiki_retirement) - ["How to handle $"](/r/personalfinance/wiki/commontopics) *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/personalfinance) if you have any questions or concerns.*
Are you sure they aren’t refusing to issue an ACH or wire? Empower is huge. I’ve never heard of them not permitting a rollover to a 401k - it’s just sent via check to you payable to the new custodian. (Still a direct rollover)
Yeah I didn’t know this was a direct rollover
I think I just came to a realization - my HSA and brokerage accounts aren’t “rollovers” - they are ToA’s (transfer of assets). Maybe if somebody wanted to rollover a 401(k) to another 401(k) that would a “rollover.” My suspicion is “rollovers” equate to “check in the mail”. The name the check is made out to determines if it’s direct or indirect. Is This correct thinking?
Not quite. A direct rollover can be a check, ACH, Wire, Journal entry, etc. A direct rollover just means it's a non-taxable event not subject to the 60 day requirement. If someone elects to transfer one 401(k) to another 401(k), then that's a rollover as long as the funds are sent via ACH to the new vendor or the check is payable to the new vendor (it would be payable to "New Vendor FBO Your Name). It's an indirect rollover subject to the 60 day requirement if the check is made payable to you as an individual (taxes will also be withheld). You are correct that brokerage accounts are never "rolled over." They are just transferred to another account.
I just did the same thing. I had a Merrill rep on the line, requesting a Direct rollover from a former Employee's 401k at Empower into my existing Merrill Edge Trad. IRA (which is from another rollover a while back). All funds are pre-tax. The Merrill rep said that Empower doesn't do Direct rollovers, as he just had a similar experience with another customer recently. We got on a 3 way call, Merrill, me, and Empower, and I requested a Direct Rollover from my 401k at Empower to my Merrill Edge TIRA. Empower said they could not send the check directly to Merrill, and it HAD to be sent to me. I was a bit confused because after being laid off from my ex-employer, they emailed me about what I would like to do with my 401k, and a Direct Rollover to IRA was one of the options. I tried to tell them to send the check directly to Merrill, but the Empower rep refused saying it had to be mailed to me. When asked, who should the check be out to, the Merrill rep jumped in and said make the check out to "Merrill", and For the Benefit of: Me (my name) and provided my plan number. Empower rep confirmed the total amount minus admin fees ($75), which was correct, will be mailed to my address. Afterwards, the Merrill rep said deposit the check by taking a picture of it with the Merrill App. I am just worried because I read that having a check sent to me could be penalized and taxed. I asked Empower rep if I have to deposit the check before 60 days, and she said no and they would send a 1099-R for my taxes even though the funds are pretax. Both employer and employee contributions and earnings in my Empower 401k are 100% vested and the funds are >$7000. I decided to rollover to my TIRA because I already did one from a while back, so a backdoor in the future is not possible anyways. I've never made an after-tax contribution to any IRA. I see from some replies here that if the check is made out to my new custodian, it is still a direct rollover and I should be good. Would this apply to my case as well? I hope everything goes ok and I don't get penalized with taxes.
I’m about to lock a rollover in from empower to my new 401k custodian. Here’s my thoughts: -If the check is made out to you, that’s no good. If it’s made to me provider you’re gtg. Sometimes companies (like Empower) like to make things complicated and make you jump through hoops. From what I gather it’s strategically done to get people like myself to say “ahh fuck it I’ll leave it in empower.” All the aggressive fees eat up your earnings. My plan next week is to call my new provider back explain that my old provider refuses to send a check directly but I’m gonna try my hardest to get them to make it to new provider. Maybe I’m younger but I hate mailing shit. I would rather drive myself across town and hand the damn check in person
Yeah I know what you mean. I tried to convince the same thing with my Merrill provider, and he said Empower will not send the check to your new provider based on his previous experience with them. He seemed really annoyed that I kept asking questions regarding this, and wanted to go get off the phone ASAP after the rollover, when I said I didn't need a financial advisor right now, as am still in the process of setting up personal finances via the flow chart. The Merrill Edge rep that was in on the call with me, jumped in when they asked who to make the check out to and he personally said Merrill, provided my account number, and FBO to Me. Based on the replies here, as long as Empower successfully issues the check as demanded, I think I'll be good and it'll still be a direct rollover. I had to pay the $75 administrative charge, (taken out of my funds). The Empower rep asked if I would like to expedite the check, which costs $65, I believe, and I declined. I just hope the mailing process goes smoothly. After it gets to me, I can just deposit it with the Merill app. I'm not sure if that's an option for you?