How to Roll Over your 401k to a Fidelity Traditional IRA (Beginner’s Guide)

Someone asks:

Leaving my employer in two weeks. Any pointers on how to roll over 401k into a Traditional IRA with Fidelity?

How to Perform a 401k Rollover on Fidelity

Start by creating your Traditional IRA. Call your 401k, provide the information, and they will either direct transfer it to the new account or cut you a check that you have to mail. It’s been done both ways for me. There should be no tax consequences as long as it moves from one tax-deferred account to another.

And that is it. A simple 401k rollover to Fidelity can be done in 3 easy steps.

Other suggestions

Joy Y:

You can also call Fidelity’s customer service and they will walk you through all of it. They are THE BEST customer service.

Joshua W:

We’re going through that right now.

It’s somewhat of a lengthy process, depending on the previous employer.

I recommend calendaring dates that they give you, because this is something that can easily be forgotten.

For example, if they say something might take 30-45 days to do, put the 45th day in your calendar to remind you to check and see if it’s happened yet.

Kyle H:

If you think you will ever need a back door Roth IRA, don’t be so quick to roll over into a traditional IRA. You will upset the pro-rata rule. If you don’t think you will use it, roll on!

Nate B:

Just make sure the funds are sent directly from one provider to another (not to you). If you’re going with Fidelity, call their customer service team or your advisor can facilitate for you as well.

If you rollover a 401k to a Roth IRA, does that count as the max contribution?

A rollover is completely separate from your annual contribution limits. And in this case it sounds like rollover then a conversion, regardless, still separate.

Which Fund Should I Invest In After Rolling Over my 401k to a Fidelity IRA?

Long term Vanguard investor but decided to roll over my employer 401k managed by Fidelity to a Fidelity IRA to avoid being out of the market. I see they have zero cost index funds. What is the fine print to these funds?

There is no catch!

Gerry S:

I am in FNILX that is similar to an S&P 500 index. There is no catch. The prospectus to the fund says no expense ratio. These are basically loss leaders that Fidelity wants to use to lure assets under management with the hope that new customers also pick up some of their other funds. They may also lend the money for people trading options and for trading volume fees (these are the same fees free brokerages like Robinhood get from stock exchanges for a certain volume of trades).

Robert A:

The Fidelity zero funds probably engage in securities lending, which covers the administrative cost and probably provides some type of margin to Fidelity.

Andrew B:

For stocks: consider domestic vs international. I’d suggest FSKAX for domestic and FSPSX for international.

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