Tweet
For anyone that that has set up a SEP IRA at Vanguard but now wants to utilize a backdoor roth you will find that Vanguard does not have a standard plan to enable a rollover into a solo 401k. You can use a custom solo 401k at Vanguard if you jump through a few hoops. Fidelity will however allow a rollover into a solo 401k without any additional expenditures.
Below are the general steps for moving from a Vanguard SEP IRA to Fidelity Self Employed 401k. I just completed this process. It wasn't hard and the Fidelity customer service was good. I wish I'd have known about backdoor Roth contributions prior to starting my SEP plan originally. Be prepared for at least one person to ask you why you are doing this. I guess there are not a lot of people that want to max so much space out.
1. Open an account. (I had a prior employer with Fidelity so no new account for me).
2. Setup individual 401k at Fidelity. This will eventually show up as a Profit Sharing Keogh. (give it a week, probably just a couple days)
3. Call Fidelity to set up your rollover. Fidelity will want to move it to a Rollover IRA first. If you are holding admiral shares you will need to move your funds to cash for the rollover as you cannot hold the admiral shares in a Fidelity account. (started process on a Thursday, money moved 4 days later)
4. After the money arrives at Fidelity you must then roll the money from your rollover IRA to your individual 401k (the form). I dropped it off at an actual Fidelity Investment center however you can mail it after a medallion signature if you are not close to a Fidelity branch. As crazy as it may be, my money was mailed by check from Fidelity to Fidelity to be deposited with my PLLC's plan. I kept everything in cash to stay simple since I already needed to eliminate my admiral shares. (an additional few days of waiting)
Anyone else have a similar experience or comments on the path it took me?
Below are the general steps for moving from a Vanguard SEP IRA to Fidelity Self Employed 401k. I just completed this process. It wasn't hard and the Fidelity customer service was good. I wish I'd have known about backdoor Roth contributions prior to starting my SEP plan originally. Be prepared for at least one person to ask you why you are doing this. I guess there are not a lot of people that want to max so much space out.
1. Open an account. (I had a prior employer with Fidelity so no new account for me).
2. Setup individual 401k at Fidelity. This will eventually show up as a Profit Sharing Keogh. (give it a week, probably just a couple days)
3. Call Fidelity to set up your rollover. Fidelity will want to move it to a Rollover IRA first. If you are holding admiral shares you will need to move your funds to cash for the rollover as you cannot hold the admiral shares in a Fidelity account. (started process on a Thursday, money moved 4 days later)
4. After the money arrives at Fidelity you must then roll the money from your rollover IRA to your individual 401k (the form). I dropped it off at an actual Fidelity Investment center however you can mail it after a medallion signature if you are not close to a Fidelity branch. As crazy as it may be, my money was mailed by check from Fidelity to Fidelity to be deposited with my PLLC's plan. I kept everything in cash to stay simple since I already needed to eliminate my admiral shares. (an additional few days of waiting)
Anyone else have a similar experience or comments on the path it took me?
Comment