Learn me; investing my old 401K

I have a 401K from a previous job that needs to be moved shortly.

My options are to roll it into my current jobs 401K, or one of the online sites/companies (TD Ameritrade, Fidelity, Etrade, etc...)

I'm leaning towards the latter, is there one site that's better than the others?

I don't see myself doing much trading currently, just diversifying by being able to pick certain stocks VS a general index fund.

As far as the dollar amount per trade the sites mention, is that the fee per transaction (regardless of how many stocks i'm buying)?

any other information you wish to impart upon me is welcome as well.

Is your new 401k with one of the discount brokers (Vanguard, Fidelity, Schwab etc)? Or is your old one with one of them?

If the answer is yes to the first question, roll it over. Second question, keep it there, maybe in a rollover IRA.

I'm not a big fan of individual stock trading, I'd stick to index funds. Most of the discount places offer a good selection commission free and depending on the amount, a certain number of trades annually could have their commission waived.

And yes, the commission/trade fee is per trade, usually no matter what the size is.

Rollover to IRA with Fidelity or Vanguard.

I would stick to funds.

There are fees in the form of expense ratios - % of portfolio value charged each year, these should be really low, like 0.03% or zero (see Fidelity here)

There are also trading fees - $5 for example, these are charged on each stock transaction

If you want to trade stocks, you need a certain type of IRA that allows for that.  MTN may come in and shed more light on that.

Does it actually need to be moved? Usually you can leave it where it is if you desire. I did that with one of my accounts because the fee was so low that I couldn't beat it, and the investment mix was almost identical to what I'd have anyway. 

In general, look at the fees and the options. If your current 401k has good options, for simplicity sake it may be better to do that. Depending on your current age and situation, you may also want to be backdoor rothing it. 

As far as the actual investment, your statement "just diversifying by being able to pick certain stocks VS a general index fund" is completely oxymoronic. And unless you've tested your stock picking with a long history of success (try quantopian.com if you have an algorithm), just stick with index funds. And to that end, go with Vanguard. 

ProDarwin said:

 

If you want to trade stocks, you need a certain type of IRA that allows for that.  MTN may come in and shed more light on that.

Most allow for it. My Fidelity IRA I can trade the same as a brokerage account; I just can only deposit $5500 annually, can't trade on margin, etc.

Generally speaking, 401(k)s limit your investment options to a dozen or so funds, which are rarely the ones with the lowest fees.  Given that, it's usually better to roll the funds into an IRA that doesn't have those limits than into another 401(k).  There are also strategies for converting IRAs into Roth IRAs which is sometimes beneficial from a tax perspective (I don't know details about that though).

You want to be careful about mixing pre- and post-tax funds into the same account though.  If you've already got an IRA with post-tax funds in it, it's probably simpler to start a new IRA to roll a 401(k) into, rather than dumping them into an existing one.

codrus said:

Generally speaking, 401(k)s limit your investment options to a dozen or so funds, which are rarely the ones with the lowest fees.  Given that, it's usually better to roll the funds into an IRA that doesn't have those limits than into another 401(k).  There are also strategies for converting IRAs into Roth IRAs which is sometimes beneficial from a tax perspective (I don't know details about that though).

 

I've now had 4 different 401k's. 

• 1 was OK. About what I could do in an IRA fee wise. Rolled it into my Vanguard IRA.
• 1 was horrible. Didn't even contribute to it past the match. Rolled it into my Fidelity IRA. Not much in that one, I play with it actively trading. Fidelity is a better platform for active trading than Vanguard. If you have 6 digits and want to actively trade (and I really hope you know hwat you're doing if you do), then I think that Interactive Brokers is typically where it makes the most sense. But I'm not there. 
• 2 of them have had the investment options almost identical to what I would have picked, and they also have the lowest fees I've ever seen. I left my funds in that first one, my current 401k is the other. Both of these are from huge Fortune 500 companies that are critically important to the US economy, FWIW. I think my current fee in both of them is something like .06%

Hookers and blow is a good retirement plan. 

It's funny. I'm just in the midst of this. 

I've had Fidelity for a few 401k accounts so far, so the one account that wasn't through Fidelity I just decided to rollover to my existing Fidelity IRA. 

My wife on the other hand has never had the same retirement fund company twice. She's got 4 accounts.

Her current account is TIAA, and I'm leary about rolling over her old funds with them. I'd soon she rollover the old accounts in Vanguard. Thoughts on that (and TIAA?)

Mndsm said:

Hookers and blow is a good retirement plan. 

Almost as good as the die on time plan.

In reply to 1kris06 :

Since you know you can’t touch it or you pay a major tax penalty, have them do the transfer.  

When I had money for retirement I wanted everything without any effort.  I bought the DOW. That is a nice safe secure index fund called the Diamonds. Most index funds have high overheads and one way or another you pay that overhead.  

With the Diamonds all they do is buy stocks in the companies that make up the DOW. Administration costs are basically a clerk and a calculator ( in other words minimal) 

Since the DOW is the big boys in the country you won’t get any sudden leaps but you also won’t get any terrible falls either. In general, you’ll get the rate of return the nation as a whole gets. ( which if you believe in America as I do is decent and respectable) I might remind you the tortoise won the race with the hare.  This isn’t exciting, but do you really want to gamble with your retirement?  Every news report usually contains a message of how the DOW is doing so keeping track is about as easy as it gets.  

IRA.

Put it all in VTSAX, or similar low fee fund that tracks the market. 

Forget it until you contribute again next year.

Repeat until retirement.