I’m a noob seeking advice on what to do with my prior employer 401k. Insights?

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Rollover to new employer’s 401k. The alternative would be to open an IRA but I recently learned that that would interfere with Backdoor IRA (if and when you decide to go that route)

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This is the answer

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Rollover to an IRA using any broker you prefer. That allows you to invest in anything you want to. ETFs with low fees are the safest bet (think S&P 500 benchmark). Add to your investments regularly over time in predefined amounts and put on autopilot. You’ll do well historically without worrying about when to buy if you do.

Having control also gives you the opportunity to invest in individual stocks of companies you know well. It can be riskier, but returns can be amazing especially if you’re young. So glad I picked up a few stocks of companies I loved when I first started like Apple, Netflix and FB.

Good luck!

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My preference is Roth first if you can. Max that out. You can always take out what you put in if needed, and the tax free growth is amazing if you’re young.

Knowing my 401k is setup across ETFs and broader funds, I choose to use my Roth to pick up some individual stocks. Buying and holding companies I believed in helped my much smaller Roth now dwarf the slower but steady growth of my 401k.

Do what works best for you and buy more if you can during big dips like we saw this year! You’ll be glad over the long run.

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Following 😬

At Deloitte, you have to roll it over. There’s also the benefit of only having one account to manage.

On the other hand, your prior employer’s plan may allow you to invest in assets that aren’t available through your new employer.

Is the total combined limit for Roth and before tax 401k, 39,000?

No it’s 19,500 for both. You can put it all in a Roth, Traditional, or split it between both.

And they limit has nothing to do with rolling an old employer 401k into a new 401k or IRA. It’s not considered a contribution, it’s considered a rollover (from my understanding)

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I just pretend like it never existed. 😅

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