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How to rollover a 401(k) in a single phone call

Roll of hay (hay bale)

A 401(k) rollover isn’t complicated. It can usually be done with a 10 minute phone call. Here is how to do it.

There are several options for what you can do with your old 401(k), which we detail in our article 7 Things you can do with your old 401(k). 

SHRM, the Society for Human Resource Management, has a great page that describes all the players involved in a 401(k).

Also, the IRS has a page that talks about rollovers and plan distributions. Occasionally the terminology is slightly different that what practitioners use (for instance, the IRS uses the word “trustee”, while the industry usually refers to them as “custodians”).

So, without further delay, let’s get started on the details. The process is pretty straight forward:

  1. Get ready
  2. Start the rollover
  3. Withholding taxes
  4. Distribute the funds
  5. Make out the check
  6. Deposit the check

Steps to rollover a 401(k)

1. Get Ready

picture of red public telephone box

Get your 401K provider’s phone number handy. See the list below for the top 401(k) provider phone numbers and web sites.

You do not need your account number, but you will have to verify your identity.

You can view the plan provider contact information at the end of the article for the largest providers.

2. Start the Transfer

Tell them that you want to closeout your account with a “custodian to custodian transfer” to the custodian of your IRA.  

They might call that a “rollover”, but technically, when a check is made out to a custodian for your benefit, it’s a custodian to custodian transfer.
This must be from a former employer - this cannot be done with your current employer.

One thing that comes up from time to time is “can I keep my mutual funds?” The short answer is no – you will receive cash in the amount equal to the value of your funds on the day they were sold minus any closeout/transfer fees that the Plan Provider may charge.

3. Withholding Taxes

If the old plan provider asks, do not withhold any taxes (because none are due). Sometimes plan providers make this difficult and withhold it regardless of what you want. In that case, there is nothing you can do except put a reminder on your calendar for when they will release the rest of the funds in your account to you. 

  • This document is simple, it basically says if you cash the check, that you could be liable for tax on it.  Since you’re following this guide (you are, right?) then the check technically is made out to your custodian – not you, so the tax document is irrelevant. ( If you aren’t following this guide, then you better read the whole thing thoroughly! )
  • Certain plan providers will ask if you’ve read the “Tax document” (Fidelity will always ask). If you say YES, they will cut the check as soon as the funds in your 401(k) account can be sold. If you say NO, it could delay it significantly.
What happens in this case is that the old plan provider will mail you a copy of that tax document. This will probably take a week or so to get to you. 
What’s worse, though, is that the plan provider will do nothing until you call them. 
Then they will ask again about the tax document. You can see how this is a game to keep charging fees while they have your money.

4. Distribute the Funds

Picture of traffic at night

They will ask for where to send the funds. Sometimes they will wire the funds to your new account.

While this saves you the hassle of dealing with a check, it also means you need to get the wiring information from the custodian of your new account.

We’ve found that it is not really any faster.

  • Usually they will mail a check. We always tell our clients to ask for the check to be expedited and have it overnighted to your home address. They may not do this, but ask anyway so you don’t have to worry about a large check hanging out somewhere in the postal system. 
  • Sometimes they may mail the check directly to the custodian. This is the worst option because it’s hard to track, but you generally don’t have control over it

5. Make out the Check

When the provider of your old plan cuts a check, the check should be made out to the new custodian of your IRA, such as this:

Charles Schwab, FBO (your name)

Also, it’s a good idea for them to put your new account number In the memo field o the check.

6. Deposit the Check

Once you receive the check, make sure the amount is correct, and then do not cash the check, but either take it to your financial advisor or take it to your custodian for immediate deposit. 

Plan Provider Contact Information

If you have a 401(k), it is probably with one of these providers named as tops in the industry according to 401 Specialist 401(k) provider ranking. This list contains their main 401(k) phone number and website. Both of these are a great place to start when looking to contact them to roll over your old plan. 

  1. Fidelity Investments
  2. Charles Schwab
  3. Nationwide
  4. T. Rowe Price
  5. Vanguard
  6. Prudential Financial
  7. Empower Retirement
  8. Voya Financial
  9. Lincoln Financial Group
  10. John Hancock
  11. MassMutual
  12. Principal Financial Group
  13. Transamerica