Rollover IRA (STEP-BY-STEP TUTORIAL AT FIDELITY)

believe it or not in the US there's more than 7.7 billion dollars in unclaimed retirement savings floating out there that's why rolling over your old 401 K to a fidelity rollover IRA is a very good idea why not simplify your finances and just keep it all in one place you know how it is out of sight out of mind if you leave old 401 K s lying around at old jobs you might forget about it plus having old accounts lying around at previous jobs is kind of like leaving your stuff at your ex's house after you've broken up with them like why would you do that why nine times out of ten there's really no reason not to rollover your 401 K after you've left a job many 401 k plans charge really high admin fees they offer very limited investing options and if for whatever reason your old employer goes bankrupt it can be a nightmare to track down that money that is why I'm a big fan of rolling over your 401 K to fidelity with their rollover IRA so in this video I'm gonna talk about how to do a fidelity 401k rollover step by step and for those of you who have a Roth 401 K 2 rollover I'll also explain how that works as well and finally I'm gonna talk about how to invest your fidelity rollover IRA once that 401k money has transferred over we have a lot to cover in this video so just smash the like button and let's get right into it for those of you that haven't already done the rollover I'm going to walk you through how to do it step by step but for those of you who have already done this step and your rollover is already done you can just skip ahead to this timestamp of the video where I talk about three ways to invest your fidelity rollover IRA the first step is to find out where all your money is so if you think you may have 401 K s– floating around somewhere but you're not sure then I want you to contact the HR department at your old job and find out what's going on or if you actually know who the 401 K provider was you can just call them for example my old 401 K was serviced by it by Vanguard so I knew exactly who to call when I wanted to roll it over okay and the next step is to open that fidelity rollover IRA this is pretty easy to do you just go to the fidelity website you click open account and you select rollover IRA this is if you're rolling over a regular 401k if you're rolling over a Roth 401k you would need to open a Roth IRA not rollover IRA I know that rolling over a Roth 401k is still a rollover IRA but the languaging is a little bit confusing if you're rolling over your Roth 401k you need to open a Roth IRA not a rollover IRA at least that's the way it's done at fidelity if you're rolling over regular 401k money and Roth 401k money then you would need to open both you need to open a rollover IRA and a Roth IRA basically what we're doing here is we're opening the destination accounts for your 401k money the new home and the destination account has to match the type of 401k so a traditional 401k needs to get rolled into a traditional rollover IRA and a Roth 401k needs to get rolled over into a Roth IRA got it once you finish the IRA account opening process fidelity will take it to a confirmation page with the account number of your new IRA so write down this account number because you're going to need it for the next step the next step is to contact your 401k provider and tell them to send your 401k money to your new fidelity IRA for your 401k provider to do that you need to tell them three pieces of information one who to make the check payable to to the account number of your new fidelity IRA and then three the mailing address where they need to send out that check to get this information just Google fidelity rollover 401k deposit go to the top search result and you'll find fidelities instructions on everything you need to tell your 401k provider so that they send the funds to the correct place make sure your 401k provider makes the check payable to fidelity management trust company FBO your name and then tell them to include your IRA account number on the memo line and just to be clear if you have both 401k and Roth 401k money to roll over then you need to do this whole process twice two different IRAs two different checks the final step is to make sure you report the rollover correctly when you file your taxes so your 401k provider is gonna send you a form 1099 showing that you took money out of the 401k and infidelity we'll send you a form 5498 showing that you contributed money into an IRA the end result is that those amounts cancel each other out so that you won't owe any taxes and that's what makes it a rollover make sure you file both of these forms the year that you do the rollover form 1099 and form 5498 so that you don't run into any problems with the IRS if you get stuck anywhere during this process just pick up the phone and call fidelity believe me they are very happy to have you transfer your 401k money to them so they'll spend as much time on the phone with you as you as you need also if you could use a helpful and very complete guide on how all of these different retirement accounts work they don't load my ultimate guide to IRAs 401ks and HSAs it's a neat little cheat sheet that summarizes the pros and cons of each account what you can and can't do with each and which ones to prioritize and why it literally has everything you need to know about tax advantaged accounts so click the link below to download it and finally for some ideas on how to invest your fidelity rollover IRA so your your IRA just to clarify is not an investment it's just an account with money in it so even if your 401k had investments in it they'll liquidate everything when you roll it over and then until you pull the trigger on your new IRA and actually buy some investments with that money your IRA is just gonna sit and cash that's why I want to suggest three ways to invest your rollover IRA the first and easiest way to invest is by buying a target date fund target date funds also known as lifecycle funds are mutual funds that target a specific date for retirement and they're actually a fund of funds in that they are funds that usually contain anywhere from three to five different index funds inside it every target date fund has a year at the end of its name like the fidelity freedom index 20:55 or the and guard target retirement 2055 fund or the Schwab target 2055 index funds and depending on your target retirement year the fund will choose the appropriate mix of stocks and bonds for your age I actually made a video about target date funds a few weeks ago so definitely check that out if you want to go more in depth target date funds are nice because you don't have to think too much all you have to do is figure out what year you're planning to retire by a target date fund with that year and then you can just sit back and relax a lot of people retire millionaires by putting their money into target date funds every month and doing nothing else so it's a pretty decent option for busy pe

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