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Why Roll Over Your 401(k)?
If you have a previous employer's 401(k) plan, you can roll over the assets from that account into a new IRA to keep your tax-advantaged retirement plan without tax penalties. As long as the condition of your existing 401(k) permits a rollover, you can open either a traditional or Roth IRA with some of the most popular online brokers.
Rolling over your 401(k) gets you more investment flexibility, increased control over your account, lessens your tax burden, and consolidates your retirement savings in one place.
Some online brokers are more geared toward beginners, while others are better for experienced traders. Although most of the best investment apps offer retirement savings accounts, not all brokerages offer 401(k) rollover options.
Top Places to Roll Over Your 401(k) in 2024
- Fidelity IRA: Best overall rollover IRA
- SoFi IRA: Best rollover IRA for beginners
- Vanguard Personal Advisor: Best rollover IRA for advanced investors
- Betterment IRA: Best rollover IRA for socially responsible investing
- Wealthfront IRA: Best rollover IRA for large accounts
- Charles Schwab IRA: Best rollover IRA investment options
Compare the Top IRA Rollovers
When investing in the best rollover IRAs, get the most out of your retirement savings plan with a flexible IRA from top online brokerages. These platforms offer competitive pricing, financial planning services, and robust trading tools.
Compare each brokerage and investment platform thoroughly to understand the different IRA rollover rules. Also, ensure you know the tax implications of a 401(k) rollover before moving your assets.
Here are the best IRAs for 401(k) rollovers as Business Insider's editors picked in 2024.
$0
0%; robo-advice: $0 for balances under $10,000; $3/month for balances between $10,000 and $49,999; 0.35% for balances over $50,000
Traditional IRAs, Roth IRAs, rollover IRAs, Roth IRA for Kids, SEP IRAs, and SIMPLE IRAs
- Commission-free stocks, ETFs, and options
- No minimums; fractional shares
- Thousands of no-transaction-fee mutual funds
- Fidelity Go automated accounts cost more for higher balances
- Expensive representative-assisted trade fee
Fidelity is one of the best online brokerages for retirement savings. It has great features for all types of investors and traders.
Fidelity IRA- Consider it if: You're solely focused on retirement planning strategies and want commission-free trades.
- App store rating: 4.8 iOS/4.3 Android
$0
0%
Traditional IRAs, Roth IRAs, and SEP IRAs
- No minimums or fees
- Certified financial planner access
- Cryptocurrency trading available
- No tax-loss harvesting
- Limited investment selection
SoFi is a great choice for traditional IRAs. In addition to other investing, loans and savings options, the advisor provides Roth and SEP IRAs.
SoFi IRA- Consider it if: You're new to investing and want a variety of low-cost retirement, investing, and savings options.
- App store rating: 4.8 iOS/4.3 Android
$50,000
0.30% balances under $5 million; those with larger balances pay less
- Low fees
- Access to fiduciary advisors
- Supported account types include individual and joint accounts, traditional and Roth IRAs, trust accounts, and eligible employer-sponsored accounts
- Account includes automatic portfolio rebalancing and specific strategies to suit different goals
- Doesn't offer individual stocks, bonds, cryptocurrencies, or options
$0 to open, $10 to start investing ($100,000 for premium plan)
0.25% digital plan; 0.40% for premium plan
Traditional IRAs, Roth IRAs, rollover IRAs, and SEP IRAs
- No minimums for digital plan
- Tax-loss harvesting, goal-focused investing strategies, charitable giving, and socially responsible investing
- Certified financial planners available
- Can only invest in stock ETFs and bond ETFs
- Financial advisor consultations cost more for those without premium plan
Betterment is best for hands-off investors who want to take advantage of professionally built, personalized ETF and cryptocurrency portfolios. The platform offers CFP access, so it could suit those in search of additional guidance from human advisors.
Betterment IRA- Betterment offers rollover IRAs, traditional and Roth IRAs, SEP IRAs, and more.
$500
0.25%; 0.06 - 0.13% for low-cost investment funds
Traditional IRAs, Roth IRAs, and SEP IRAs
- Low annual fee for investment accounts; crypto trust investments available
- Tax-loss harvesting
- Mobile app and investing and retirement tools
- Offers traditional, Roth, and SEP IRAs
- You need at least $100,000 to utilize additional investment strategies
- No human advisor access
Wealthfront is one of the best robo-advisor options if you're in search of low-cost automated portfolio management, and one of the best socially responsible investing apps for features like tax-loss harvesting, US direct indexing, and crypto trusts.
Wealthfront IRA- Consider it if: You're looking for goal-based strategies for retirement and other savings goals.
- App store rating: 4.8 iOS/4.6 Android
$0
0%; robo-advice: $0 ($30 monthly fee for Schwab Intelligent Portfolios Premium)
Traditional IRAs, Roth IRAs, rollover IRAs, SEP IRAs, SIMPLE IRAs, inherited IRAs, and custodial IRAs
- Commission-free stocks, ETFs, and options
- No account minimums
- Variety of account types
- No cryptocurrencies
- Fees for certain mutual funds, futures, and other fixed income assets
Insider considers Charles Schwab to be the best online brokerage overall, as well as one of the best online brokerages for beginners. It's great for all types of investors — including active traders, passive investors, and retirement-focused individuals — in search of low costs and access to a variety of trading tools and platforms.
Charles Schwab IRA- Consider it if: You're looking for access to multiple self-directed or automated retirement and investing accounts; you value retirement planning resources and mobile access.
- App store rating: 4.8 iOS/3.8 Android
- Awards: Investor's Business Daily recognized Charles Schwab as one of its Most Trusted Financial Companies for 2021.
Best 401(k) Rollovers
Best Overall Rollover IRA
Both passive and active investors can benefit from a Fidelity brokerage account. Fidelity's self-directed brokerage offers a wide range of securities, or you can invest in a mutual fund through its robo-advisor, Fidelity Go. Advanced traders can also access fractional shares, smart trading technology, commission-free trades, and goal-building features.
Fidelity Go invests your funds in a blend of domestic and foreign stocks, bonds, and other short-term investments. Fidelity Go accounts now get unlimited access to one-on-one coaching calls.
A Fidelity retirement account gets you access to a handful of helpful tools and retirement calculators, including the guaranteed income estimator and the retirement strategies tax estimator. Moreover, you can open a brokerage account within your retirement savings account to access a broader range of investment options.
What to watch out for: You may have to pay a 0.35% advisory fee if you have an account balance of over $25,000, plus Fidelity charges higher margin rates than most competitor platforms. Fidelity Go doesn't offer tax loss harvesting. There are also additional fees for any phone or broker-assisted trades.
Best Rollover IRA for Beginners
SoFi is a prominent choice for investors to roll their 401(k) funds into a new traditional IRA or Roth IRA. You can open your SoFi IRA as a self-directed or automated retirement account. It also offers a 1% match on all traditional and Roth contributions.
Even though anyone can benefit from a SoFi account, its easy-to-use interface and straightforward planning/goal tools make it one of the best online brokerages for beginners. Moreover, SoFi has no minimum for opening an account and no account or trading fees.
SoFi Invest®'s robo-advisor creates a personalized portfolio of stocks and bonds based on your retirement goals, risk tolerance, and time horizon. Or you can invest in one of the pre-built ETF portfolios.
SoFi provides clients with retirement-focused financial tools and planning resources, such as access to SoFi's financial planners, auto-rebalancing (limited to automated accounts), goal-building tools, and additional member benefits.
What to watch out for: SoFi automated accounts don't offer tax-loss harvesting.
Best Rollover IRA for Advanced Investors
Vanguard Personal Advisor is one of two automated accounts offered by Vanguard. The other automated account is Vanguard Digital Advisor. Vanguard Personal Advisor provides digital management and ongoing financial advice from fiduciary advisors.
You can roll over a past employer-sponsored 401(k) or 403(b) account into a new or existing traditional or Roth Vanguard IRA. You can invest in Vanguard's diversified blend of US and internal exchange-traded funds (ETFs), mutual funds, and ESG investing portfolios.
Vanguard's fiduciary advisor provides users with ongoing investment guidance, goal-building advice, and active portfolio management. Vanguard Personal Advisor also offers tax-loss harvesting, the convenience of a robo-advisor, and a customized financial plan.
What to look out for: Only investors that can meet Vanguard Personal Advisor high $50,000 minimum should open an account. Plus, the more money in your account, the lower the advisory fee.
Vanguard Personal Advisor review
Best Rollover IRA for Socially Responsible Investing
Betterment Investing is a robo-advisor that creates professionally built, personalized, low-cost ETF and cryptocurrency portfolios. If you're looking to invest in businesses that align with your values, Betterment is a great choice. It's one of the best socially responsible investing apps out there.
Betterment offers multiple socially responsible, Smart Beta, cryptocurrency, and BlackRock Target Income portfolios. There's no minimum investment requirement to open an account with Betterment (unless you open a premium plan), and fees are generally low. Betterment also offers tax loss harvesting features.
What to watch out for: To access CFPs from Betterment, you must have at least $100,000 in your account.
Best Rollover IRA for Large Accounts
Wealthfront Investing is a competitive, low-cost robo-advisor for ESG investing and crypto trusts. Both beginners and experienced investors can use Wealthfront. While you only need $1 to start investing with Wealthfront, it's best for larger account balances since you need at least $100,000 to access Wealthfront's direct indexing and risk parity investing strategies.
Investors can roll over a 401(k), 403(b), or 457 plan to a Wealthfront traditional or Roth IRA. Wealthfront also offers tax loss harvesting, auto rebalancing, and smart beta technology. The platform offers dividend growth stocks, emerging market stocks, corporate bonds, ETFs, index funds, a high-yield bond portfolio, and more.
What to watch out for: Wealthfront doesn't offer ongoing human advisor access and has a higher minimum ($500) to start investing than other leading robo-advisors.
Best IRA Rollover for Investment Options
Charles Schwab is one of the top brokerages for all kinds of investors, especially retirement-focused individuals wanting to invest funds in multiple asset classes. Charles Schwab is also featured as one of our best brokerages to trade commodity futures.
Charles Schwab offers stocks, bonds, ETFs, CDs, index funds, and mutual funds. The brokerage also offers low fees, no account minimum, and commission-free trading. You can easily roll over your 401(k) plan into a traditional or Roth IRA. Charles Schwab offers both self-directed and automated accounts. But automated accounts only invest in low-cost ETFs, which include Schwab ETFs.
Charles Schwab IRAs get you access to the brokerage's selection of retirement tools, planning calculators (including retirement savings calculator and RMD calculator), the latest market commentary, and insight and investing ideas from Schwab experts.
What to watch out for: Charles Schwab's automated investing platform (Schwab Intelligent Portfolios) requires a much higher minimum ($5,000 minimum or $25,000 for Portfolios Premium).
IRA Rollover FAQs
The best place for your 401(k) rollover depends on your individual situation. The best brokerage for a 401(k) rollover depends on your goals, desired assets to invest in, experience level, and how much you're willing to pay in minimums and fees. Make sure to compare all your options before opening an account.
The rule for rolling over a 401(k) is that to avoid additional tax or penalty fees, you must roll over the assets from your old 401(k) plan into an IRA or new 401(k) within 60 days of leaving your previous employer. Also, the old employer recovers unvested assets (including company stock or money).
The best place for your 401(k) rollover depends on your individual situation. The best brokerage for a 401(k) rollover depends on your goals, desired assets to invest in, level of experience, and how much you're willing to pay in minimums and fees. Make sure to compare all your options before opening an account.
Why You Should Trust Us: Our Expert Panel For The Best Rollover IRAs
We interviewed the following investing experts to see what they had to say about IRA rollovers.
- Sandra Cho, RIA, wealth manager, and CEO of Pointwealth Capital Management
- Tessa Campbell, Investment and retirement reporter at Personal Finance Insider
What are the advantages/disadvantages of rolling over assets into a new IRA?
Sandra Cho:
"Specifically for rolling over an employer-sponsored retirement plan, the advantages are numerous. Rolling over this account will provide you with greater investment options and increased transparency compared to keeping the 401(k) with the previous fund company. You also will not be charged any taxes or fees on the transfer. The fees associated with the actual investments in the account will likely go down as 401(k) typically have higher-cost funds.
"The disadvantages are little. Depending on the previous fund company, a disadvantage could be the hassle it may take to get the account transferred. Sometimes, this may require a liquidation of the account and a check sent to the individual. In this case, the individual must make sure they deposit the funds as soon as possible into the new account to avoid paying penalties."
Tessa Campbell:
"Rolling over your old 401(k) assets into a new IRA has a number of advantages, including lowering the cost of management fees, increased control over your investments, and more investment options. Moreover, having all your assets in one place is simpler if you already have an existing IRA.
"The disadvantage of an IRA rollover is that you may have to pay income tax if you roll over funds into a Roth IRA. Plus, you may lose any potential existing benefits of your old 401(k) plan. Any company stock in your old 401(k) plan may not be eligible for a rollover."
Who should consider rolling over assets into a new account?
Sandra Cho:
"Anyone who has an old employer-sponsored retirement plan and no longer is an employee of that firm should consider rolling assets into a new account. It really is a no brainer and can boost your long-term return."
Tessa Campbell:
"You should consider rolling over assets from an old 401(k) account if you're no longer employed by the company that originally offered the plan. Once you leave that employer, you'll lose any unvested money or stock in your 401(k) and the high management fees.
"You can roll over assets from an old 401(k) either into an IRA or a new 401(k) — as long as your old plan's policy allows it."
Is there any advice you'd offer someone who's looking to roll over an old 401(k) into a new IRA?
Sandra Cho:
"I would advise them to reach out to their old 401(k) provider as soon as possible. They need to make sure that they know all the details about how to rollover their account and have to remain persistent. Sometimes 401(k) companies do not have the best customer service and are delayed in their responses or actions."
Tessa Campbell:
"Make sure to roll over the old 401(k) assets into a new IRA or 401(k) plan within 60 days of leaving your previous employer, or you may receive additional taxes or penalty fees. If you have trouble finding your old 401(k) plan, you can use services like Capitalize or Meet Beagle for help."
Methodology: How to Choose a Rollover IRA
We used Business Insider's methodology for rating investment platforms when reviewing online brokers offering 401(k) rollovers to find the best platforms for investment options, low fees and minimums, portfolio types, human advisor access, and customer service. We also favored platforms offering various other features and products, such as tax-loss harvesting, robo-advisor access, and market research. Investment platforms are given a rating between 1 and 5.
