Rolling 401k into an IRA while still with current employer?

[mrobert]

California...
I am currently employed and wish to remain so, BUT, we no longer have empoyer matching funds nor do I care for the way my 401k is being managed. I have been informed that the ONLY way to roll the money elsewhere I would have to be terminated/quit with my current employer. This makes absolutely no sense to me! I like my job but not my 401k! If my money is being mismanaged and dwindling away I should have the right to move it elsewhere, not just move it around within the same plan that has very little selection... Is this truly the case or have I been mis-informed?

 

[Dandy Don]

Who is telling you this--your employer or the firm that is managing the account? If they can't verify this with backup documentation, then I would be very suspicious of that explanation.

 

[cbg]

Sorry, Don, but in this case whether it makes sense or not, that is the law. There is NO provision in the IRS code for an employee to move his monies out of the 401k while the employee is still with the administrating employer. Most plans allow for you to reallocate your money within what plans are offered by the 401k, but if you are still employed you CANNOT legally take that money out of the 401k.

 

[FirstChance]

I don't know about where you are...

But in California you can roll your 401(k) monies out of your current employer's account and into a private account or IRA without sacrificing your employment. this will most likely require you to fill out forms directly with the company managing your 401(k), and will more then likly bar you from future enrollment, as well as the tax benifits of having a qualified plan, ie the $3000 you can right off on your taxes.

if you really don't like what your account is doing, look at what other options you have within the plan. moving your money from a stock account to a bond or annuity or even a fixed account would at least limit your loses and would not cause you to lose any of the tax benifits of being in the plan.