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403b Transfer To An Ira While Still Employed-


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#1 HSCounselor

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Posted 02 May 2007 - 10:48 PM

I have spoken with Fidelity when I was researching how to transfer my inactive account that I have referenced in a prior post. While looking for the correct application online, I noticed there was not one at all that had 403b anywhere. The representative asked a few questions and here are the details.

I have contributed to the plan I wish to transfer for many years but not in the past year. I still AM EMPLOYED with the same district.

I currently contribute to another broker through payroll deductions and not the one I want to move.

I want to transfer the entire balance of the annuity and was looking for a 403b or 94-20 or some such application title on Fidelity's site.

Problem: Fidelity has nothing that has 403b anywhere in the title. They said I would do a rollover to a 401k since I am moving it from an inactive 403b. The word rollover rather than transfer makes me nervous. Vanguard says they are totally two separate things.

Questions: 1) Is this correct--that it will become a 401k when I transfer it regardless of the company, and
2) What if I want to start contributing to this again? It will be labeled a 401k rather than a 403b and that means (I assume) that I could not contribute via payroll deductions???

Vanguard's application actually has the 403b in the application but Fidelity does not. I am concerned that once rolled into a 401k it is no longer a "teacher's" retirement vehicle and I will not be able to contriute to it through payroll deduction in the future should I desire to do so.

Those of you who moved money to Fido while still employed, how did you accomplish this? Did you go to a 401K as the representative from FIDO had me set up? I have moved NO MONEY in yet as something does not seem right to me.

#2 kev

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Posted 03 May 2007 - 07:42 AM

That does not sound quite right to me either. Definitely do some checking and get second opinions first. I have not invested through fidelity at all, so, I can't offer much insight in regard to their procedures. But, the whole 403b to IRA/401K seems strange to me - especially if you want to keep contributing to it. Here is the "403b page" at TRP that I used - obviously it does not help you specifically with fidelity, but maybe there are some things on there that can help you find what you are looking for with fidelity. I used the basic 403b transfer form, filled it out, mailed it and a couple weeks later, it was done.

I will see if I can find anything else of use if I have a few free moments.

http://www.trowepric...53D7559,00.html

#3 kev

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Posted 03 May 2007 - 08:34 AM

I found this at fidelity.com. Once you are at fidelity.com, click on "for individuals" in the upper left. A box will come up that has "nonprofit" at the bottom. Click on that. The site that comes up, is the link below. Once you are there, on the right side, under "Forms" scroll to 403b enrollment - that links you to the forms you should need for transfer. I think this should provide what you are looking for.


When I did mine through TRP, I just downloaded forms off the website, and then I called and asked specific questions off of specific forms when I needed, and just to confirm what I was doing was correct. If you have aspecific form you are working off of, that may help with getting answers.

Hope this helps.

http://www.mysavings....com/atwork.htm

#4 Guest_Sierra_*

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Posted 03 May 2007 - 09:14 AM

One (including the surviving spouse) can do a Revenue Ruling 90-24 Transfer at anytime and at any age and regardless of employment status. This is an IRS non-reportable event. The new account must also be a 403b investment.

One can do a Rollover upon the satisfaction of one of the following triggering events: Death, disability, separation from service or upon attainment of age 59-1/2. The new account need not be a 403b investment. It could be an IRA or 401(k) for example. A rollover is an IRS reportable event.

Joel L. Frank

#5 bmklaver

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Posted 03 May 2007 - 10:40 AM

QUOTE(HSCounselor @ May 2 2007, 10:48 PM) View Post

I have spoken with Fidelity when I was researching how to transfer my inactive account that I have referenced in a prior post. While looking for the correct application online, I noticed there was not one at all that had 403b anywhere. The representative asked a few questions and here are the details.

I have contributed to the plan I wish to transfer for many years but not in the past year. I still AM EMPLOYED with the same district.

I currently contribute to another broker through payroll deductions and not the one I want to move.

I want to transfer the entire balance of the annuity and was looking for a 403b or 94-20 or some such application title on Fidelity's site.

Problem: Fidelity has nothing that has 403b anywhere in the title. They said I would do a rollover to a 401k since I am moving it from an inactive 403b. The word rollover rather than transfer makes me nervous. Vanguard says they are totally two separate things.

Questions: 1) Is this correct--that it will become a 401k when I transfer it regardless of the company, and
2) What if I want to start contributing to this again? It will be labeled a 401k rather than a 403b and that means (I assume) that I could not contribute via payroll deductions???

Vanguard's application actually has the 403b in the application but Fidelity does not. I am concerned that once rolled into a 401k it is no longer a "teacher's" retirement vehicle and I will not be able to contriute to it through payroll deduction in the future should I desire to do so.

Those of you who moved money to Fido while still employed, how did you accomplish this? Did you go to a 401K as the representative from FIDO had me set up? I have moved NO MONEY in yet as something does not seem right to me.


Why don't you transfer the money to your 403(b) plan that you are currently contributing to? Are you now contributing to a 403(b)(7)? You can transfer it using the sending companies transfer form (outgoing transfer). You need to contact the company that you have the plan with that you want to surrender. We are going through this process now. They sent me one through email in PDF form. Once we have our new 403(b) plan opened, we will then transfer the funds. The outgoing transfer form that we received has the appropriate checkboxes where you can specify what your current plan description is and what your plan sending to is.
If you are not sure, you should get the correct info from your HR person, the sending company, and the receiving company.


#6 HSCounselor

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Posted 03 May 2007 - 04:30 PM

The reason I am not transfering to the one I am currently contributing to is because I am currently with a broker with American funds and I do not want to buy that much with a 5% front end load. The load fee alone would be 3,200.00 I am sure my broker would love that though! I am going to transfer this into a new 403b since the one I am closing is a fee laden annuity. (Luckily I have no surrender fees since I have been with them for 15 years). Once that is settled, I may stop with my current broker and continue with the index funds at Fidelity. I am sold on that based on all the data I have run on the effects of fees over the long term. I have never gotten any advice that was worth as much as what I have learned on my own and through sites like this one and individuals who have nothing to gain except to help educate others who have gone down more costly roads. I have no real need to pay an advisor for what I can do myself. And frankly I find this interesting and don't mind doing the work and research.

I am sorry if I was not clear on why I did not want to put it with my current plan.

Now I am going to call and get it done right. There is a website at www.fidelityatwork.com and it has the nonprofits/schools. It is a different department and phone number I discovered. I knew this didn't sound right to me. So beware if you are an educator that you go through the right department to get the correct account set up for your express purpose. I now have to cancel the 401k and start a new application. No problem, though. I am just glad it had not been funded yet.