I've got a 401(k) from my previous employer that I'm 100% vested in, and can roll it over into a Roth IRA. Or, I have a new employer with a 401(k) plan, but will only be vested 20% right now, and will go up 20% each year for 5 years until I reach 100%. Are there any real benefits I stand in either direction, or does it not really matter? My current inclination is to roll it over into an IRA, as much of my value increase from my 401(k) is coming from my SDB, and having an increase in investing vehicles would probably help increase growth potential, but I figure it's always good to ask others for input from experience as well.

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Werewolfdad t1_jeh0wf4 wrote on March 31, 2023 at 11:23 PM

#2,558,990

Do you have the cash to pay the taxes on the conversion?

Is this a high income year? If so, what worst time to convert

Vesting schedule isn’t a factor

echisholm OP t1_jeh1bhw wrote on March 31, 2023 at 11:27 PM

#2,559,202

Replying to Werewolfdad (#2,558,990)

> Do you have the cash to pay the taxes on the conversion?

Roth 401(k) to Roth IRA has a conversion cost? I did not know.

>Is this a high income year? If so, what worst time to convert

It kind of is, yeah. New job came with a substantial raise and I have long term capital gains to factor for the sale of my house, but I have taxes being withheld at regular income rates to compensate, so that should cover the extra burden.

Werewolfdad t1_jeh2k44 wrote on March 31, 2023 at 11:36 PM

#2,559,845

Replying to echisholm (#2,559,202)

> Roth 401(k) to Roth IRA has a conversion cost? I did not know.

Nowhere in your post does it say it’s a Roth 401k. That’s just a rollover.

(Any employer contributions would need to be converted however)