Should I roll my Merrill lynch traditional 401k into my new employers fidelity traditional 401k or traditional IRA?

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If you want more control over investment options and to save on fees based on your portfolio size then IRA is the way to go.

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If you plan to ever do a back door Roth IRA, then you want it in an 401k

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Yes you would, but most people don’t do that since you would need to pay taxes on it. Which is usually a bad idea while you are employed since you’ll be at a higher bracket. The usual route to do a back door Roth IRA is to contribute to a traditional Ira (which you can’t deduct due to income level) and then convert it to Roth. If you have any other balance in a traditional/rollover Ira you fall under something called the pro rata rule

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Traditional 401K

Why do you recommend 401k?

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