[USER]

My name is Eric, I am 54 years old and six months ago got laid off from my job as a director of quality for a medical device manufacturer.

We are just about through the severance funds, unemployment and now paying $2500 monthly out of pocket for Cobra health insurance until I find my next job.

The job market is extremely competitive, in some cases over 1000 applicants for the same job and I am finding that if you do get lucky enough to have interviews at some companies they just end up promoting from within after you have invested several months with the interview process.

Long story short, I am asking for advice as to what to do with my 401k which is currently at about 750k? Do I roll it into an IRA or just roll it into my next company’s 401k plan?

What company should I go with:
– Santander bank investment service ( our current bank).
– Fidelity
– Fisher
– etc.

Some additional info:
-wife works part time as a real estate agent.

– one son a freshman at a private college

– wife currently has her old 401k rolled i to Santander investment services, about 400k.

Thanks in advance for any suggestions.

[Nicole]

Where you located? My main job has some director positions open at corporate.

[Sonya]

What kinds of companies are you targeting? Happy to refer to mine if you find a fitting opening there!

[Popo]

Roll your 401k into an IRA as a rollover so you don’t mistakenly take a distribution which is taxable, esp since you aren’t 59.5.

Any of the brokerages are good with Vanguard and Fidelity having low cost funds available.

If you use an investment service they will charge you ~1% whether you have gains or lose value. At your age you can manage your assets in a conservative 60/40 allocation and save the management fees.

Vanguard Star fund or a target date fund would be a good place to start.

Having been in the same boat at age 50, I found a good job that took me to 60 and retirement but I had to move.

Not easy but glad I did. In short, keep your options open.

[Van]

Why couldn’t you leave it where it is? That’s what I did. Even with my new job, I am leaving my 401k (well into the seven figures) with Fidelity.

If you contribute to the backdoor Roth IRA, I’d either leave it where it is, or roll it to the new company 401K once you have a new job.

Rolling it to an IRA will make you run into the pro rata tax rule and not be able to contribute to the Roth IRA indirectly.

[Tristan]

To answer just your question: Not Santander (banks have limited investment options to choose from); not Fisher (high fees and they only do individual stocks, I just ran an analysis for a potential client and hypothetically can decrease her risk 16% and increase projected return 22%, and at a lower fee).

Fidelity is great if you want to self manage.
From your other info provided: Roll wifes over too.

How’s your emergency fund while you are looking for work? Is son already on loans or can you plan for loans if needed (even temp and quickly paid off) until job is replaced?

Can wife work a little more while you go through this process?

[April]

I would roll it over to Schwab or Vanguard and DIY it all to save on high fees.

If you are not sure what you are doing, there are several books, blogs, websites, videos, and podcasts that you can learn from.

The sooner you learn how to DIY, the more money you can save.

[Jane]

An option is to open a “Rollover IRA” and move the 401k to it. This is not a taxable event. I did this a couple years back.

The 401K choices that my company had were limited.

After I moved it to IRA, I had many more options to invest and I had much better gain.

But if you’re happy with your 401K choices (and they perform well), you could keep the money there.

[Arun]

Roll over to an ira at Vanguard, Fidelity or schwab. Call them and they will handle everything for you just ensure it’s a rollover you don’t get the check sent to you.

Once rollover completed you pick your investments stocks, etf etc

[Jared]

Not your bank.
Either DIY with Fidelity or Vanguard. Or find a good advisor after interviewing a few.

I’d normally say rollover to an IRA but in some cases that loses some flexibility for things like early withdraws or backdoor Roths so yours might be different.

[Mei]

Depending on what state you live in, there may be state market health insurance sign up available due to losing coverage within 60 days.

It could be cheaper than cobra.

[Barbara]

IMO Cobra is predatory. The Affordable Care Act provides at a much lower rate and with subsidies.

[Shiao]

What are the fees keeping it where it is? What are the fees of a vanguard, bank etc if you do a rollover?

[Author]

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