Would you roll over your IRA into this 403b?

[HopHunter86]

Long time reader, first time poster, thank you in advance.

In short my wife, a PGY3 in a 4 year program, has a small amount (~5k) in a traditional IRA account. I am graduating residency this year and our income will force us to start the backdoor Roth contribution process in 2018.

In short, I am not sure if this is a good 403b or should I hope for a better option to rollover into in the future?

Plan Information

403b via Lincoln Financial. Quarterly fee of 0.0313%. Accepts transfers with no processing fees (but may have one on the existing IRA end).

Has a lot of funds available but I will highlight the ones I currently use and expense ratios:

• Vanguard 500 Index Admiral, 0.04%


• Vanguard Total Intl Stock Index, 0.09%


• Vanguard Small Cap Index, 0.05%


• Vanguard Total Bond Market Index, 0.04%

 

Thank you very much for your input!

 

 

 

[PhysicianOnFIRE]

Looks good to me. The 12.5 basis points in fees isn't a deal breaker, especially with the Vanguard funds. I've seen much, much worse.

The other option is to convert the $5,000 to a Roth IRA and pay the small amount of tax this year (or next). You'll have to do the math to figure out if your marginal tax bracket is likely to be higher next year, presumably using the new brackets that are expected to take effect.

Cheers!

-PoF

[MPMD]

agree w/ PoF, roll it into a Roth

[cgossage]

If it's $5,000 I would just Convert it to a Roth account.  Sure, you will a little in taxes but I'm guessing your tax rate is relatively low at this point since your wife is still in training.

[DMFA]

You could do either 403b rollover or Roth conversion.  Neither is wrong, but I think your low tax bracket might make the Roth conversion more attractive.  You're in a good position.  Cheers

[FIREshrink]

agree, roll to roth.

but that is a great 403b and you should put in as much as you can. if there is a roth 403b even better.