How to Rollover an Old Retirement Account to an IRA

I switched jobs a lot in my early professional years. If I no longer enjoyed the job, whether the work itself or the environment changed for the worse, my wandering eye looked elsewhere.

A natural consequence to switching jobs a lot was having plenty of opportunities to rollover an old retirement account into an IRA – individual retirement account. It’s pretty easy once you know where you to look.

Most financial advisor companies (FAC), one of the most popular being Vanguard, have full service websites nowadays. You can make your request to rollover your old retirement account in a few steps, all online.

If you prefer the comfort of speaking with someone live, that’s an option also. They could walk you through the entire process. In this case, I would definitely recommend doing some additional research to find a company with good customer service. You wouldn’t want to be stuck without it.

I’m not a phone-heavy person – I’m more of a DIY-type person when it comes to this stuff. So I learned different rollover processes all through the interwebs, having made transfers from Fidelity, TIAA-CREF, and ADP.

Here’s the short-hand recipe for rolling over an old retirement account via online DIY.

  1. Take inventory of your current investment accounts, if any. Any changes like this should elicit a full review of your current portfolio, for knowledge’s sake. The first time I rolled over, I had few investment accounts to my name, so this step was easy for me.
  2. Decide which financial advisory company (FAC) you want to rollover your old retirement account to. E.g., the Merrill Lynch’s, Vanguard’s, Betterment’s and Wealthfront’s of the world. It can be a hard decision with all the options out there nowadays, but a couple of good questions to ask yourself are: Do you like seeing all your accounts conveniently in one place, like I do? Or do you like being able to compare different companies at the same time? (The latter would help make it a game, if you’re into gamifying wealth-building. It’s not always recommended, but I leave the choice up to you.)
  3. Follow the instructions on your old retirement account’s Rollover IRA page. This page will give you step-by-step instructions on how to start the rollover process, whether that’s rolling it over into a new IRA with the same company or rolling it over to a new company altogether. To find this page, do what I do – Google it. Type: “[FAC’s name here] rollover IRA,” and it will be one of the first hits, if not the very first. Every FAC should have a page like this. (If they don’t, they are missing out on a whole generation of financial DIYers.) For the few times I’ve done this – each time with a different FAC – it was always the same: my old FAC sends me a check with the full dollar amount from my retirement account, included vested amounts. The check is written to me.
  4. Wait for your rollover check in the mail. It’s fun to see how much you’ve set aside for the length of your tenure. It’s also very tempting to deposit this check into your checking account, but don’t give in! It must go straight into your new IRA.
  5. In the meantime, open a new IRA account on the FAC website of your choice. Obviously, you’ll need a place to deposit your check that ISN’T your checking account. If you do this online, you’ll be asked to deposit money somewhere along the process, and Rollover IRA is always a choice.
  6. Write the account number and address of your new FAC of choice on your checks, if necessary. You’ll find this information and any special instructions through your new IRA online account.
  7. Send check from your old FAC with the full amount in your retirement account, including vested amounts, to your new FAC. I suspect this manual process may change, but this process still involves snail mail. Make sure the new FAC’s address and any account numbers you have to write on the check(s) are 100% clear. If needed, employ the help of a good hand-writer. We all know at least one.
  8. Check within 1-2 weeks to ensure the transfer was made by logging into your new FAC. The longest a transfer took for me was about a week. I saw my rollover money appear safely in its new home each time I repeated this process.
  9. If the check hasn’t been deposited within a month or longer, call your old FAC to let them know. They’ll be able to troubleshoot and help you track down the check.

The ability to continue contributing to this new IRA of yours is dependent on a few things:

The rules regarding eligibility for IRA contributions take into account your current employment status. If you are unemployed, you will not be able to contribute unless you are married and your spouse meets specific income requirements.

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So, if you can continue contributing, consider it as part of your investment portfolio. Decide how much you want to set aside each month. Then, automate it and forget it!

Published by JD

Finding my place in life through all its beautiful distractions, making a few stops along the way.

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