How to Transfer or Rollover to a Self-Directed IRA

Moving your IRA or old 401(k) from one custodian to another is easy and you do not incur taxes or penalties when you do it properly.

Free Guide Download Button



Why it Makes Sense to Transfer your Old 401k Plan to a Self-Directed IRA

There are numerous reasons people choose to transfer and/or rollover their retirement account to a self-directed IRA. The main reason is to protect their savings from a volatile stock market or unpredictable changes in the economy. By diversifying their investments, they have a greater opportunity to stay on track with their retirement goals.

Self-directed IRAs are also known to perform much better than stocks and bonds. A recent examination of self-directed investments held at IRAR suggests that investments held for 3 years had an ROI of over 23%. This is why most investors are self-directing their retirement.

IRA Rollover Vs Transfer

Although both rollovers and transfers allow you to move your retirement savings from one financial institution to another, the process for each is different, and each have different rules.

A 401(k) rollover occurs when you move retirement funds from an employer-sponsored plan to an IRA— this is why it's also called a Rollover IRA. This option is typically chosen when an employee leaves a job and is no longer contributing to the employer-sponsored retirement plan.

A Transfer is when you move your IRA to another IRA at a different institution. In the case of a transfer, funds or assets are sent between institutions, from the previous custodian or trust company to the new one. This is not only the quickest, but also the best method of moving your IRA to a self-directed IRA.

IRA Transfers

IRA-to-IRA transfers are easy and the best way to move your retirement savings from one custodian to another. For example, you would do a transfer when moving an IRA from broker dealers like Fidelity, Schwab, Vanguard, TD Ameritrade, etc. to IRAR.

Transfers are initiated at the company where you want to move the IRA. For example, if you wish to move your IRA to IRAR:

  1. You would first complete our Transfer Form and send it back to us
  2. We would then send the completed form to your existing provider
  3. Your provider would then send your retirement funds and/or assets to IRAR

You can transfer as much as you want or only the portion of your account you wish to invest in alternative assets— investment options typically not available or allowed at your current provider such as real estate.

What is a Rollover IRA?

It is when you move retirement funds in an employer-sponsored plan—such as a 401(k) and deposit into an IRA. There are two types of rollovers, Direct Rollovers and Indirect Rollovers. 

Direct Rollovers

A Direct Rollover is when the retirement funds in an employer-sponsored plan—such as a 401(k), are moved directly from one institution to another, and then deposited directly into an IRA. This is the most productive method of moving an old 401(k) to a self-directed IRA because you, never take direct possession of the funds, and therefore the mandatory 20% withholding for taxes is not applied.

The rollover transaction is usually initiated by you—the plan participant—and requires only two steps: One, open an account and complete a Rollover Certification Form. Two, complete the forms required by your employer to move the funds out of your 401(k).

Indirect Rollover

An indirect rollover—also referred to as a 60-day rollover—is when you take possession of your retirement funds and/or assets before depositing them back into a retirement account, and do so within 60 days. For example, if you request your funds from your old 401 k—but have not yet established an IRA in which to deposit those funds, in most cases your employer will give you a distribution check in your name. You’ll then have 60 days from the day the distribution check was issued to deposit those funds in a retirement account. If you fail to complete the transaction in the 60-day window, you will be taxed and penalized if you are under age 59.

Don't Let Your Retirement Savings Get Lost in the Shuffle: Master the 401k Rollover to an IRA

Leaving your job shouldn't mean leaving your retirement on hold. Consider a 401k rollover, a strategic move to consolidate your retirement savings and keep them growing tax-advantaged. Whether you're switching employers or seeking wider investment options, rolling over your 401k to a self-directed IRA unlocks flexibility and control.

Why Rollover?

  • Consolidate and Simplify: No more juggling multiple retirement accounts. Rollover your 401k to a self-directed IRA and streamline your savings for easy tracking and management.
  • Investment Freedom: Unleash your inner investor! SDIRAs typically offer a wider range of investment options compared to employer-sponsored 401k plans. Dive into real estate or explore other alternative assets that align with your  retirement goals.

Take charge of your retirement journey – download the guide below to learn how to rollover a 401(k) to a self-directed IRA!

how to rollover 401k

Transfer and Rollover Fees

An IRA provider may charge fees when money is being put into a new IRA or taken out of an old IRA or 401(k). Here are a few types of fees to look out for when choosing your IRA provider based on fee structures.

Wire Fees

Transferring money by wire will usually result in a fee charged on both ends, by the sending and receiving institution. Understand your custodians' fee schedules.

Custodial Fees

Custodial fees are usually a type of account maintenance fee. Your IRA custodian may charge them monthly or annually.

Fees to Rollover a 401(k)

In most cases, there are fees charged for transferring your 401(k) to a newly opened, tax-advantaged retirement account with a different IRA custodian. 

What Determines These Fees?

The IRS does not determine rollover or transfer fees. Instead, this is determined by your IRA provider. That’s why selecting the right rollover IRA provider is essential to keep fees minimal. Overall, your IRA provider should support you by providing reduced fees and supporting your financial growth.

Why Choose IRAR for Your Self-Directed IRA

The answer is clear and simple!

Your account will be serviced by an experienced team of Certified IRA Services Professionals (CISP) with expertise in self-directed IRAs. Our knowledge and experience in self-directed IRA rules, regulations, and recent trends, will assist you in making smart educated decisions.

You’ll also be able to save over 50% compared to fees charged by other industry providers. We believe in maintaining lower fees because we’re committed to helping you build long-lasting retirement wealth.

At IRAR we see many cases in which IRA owners transfer their existing self-directed IRA to IRAR because they’ve grown unhappy with their current provider; account fees were too high, poor service, or the provider has gone out of business or changed in management. 

Regardless of the reason, we want to help.


IRA Transfer & 401k Rollover FAQs

What is a rollover IRA? 

A rollover IRA is when you transfer funds, assets, or retirement savings from an employer-sponsored plan such as a 401(k) into an IRA. This can be done directly from one IRA custodian to another. This movement of retirement savings is frequently done when you leave a job or retire.

Is a rollover IRA a Traditional IRA? 

A rollover IRA is usually the movement of and employer-sponsored plan like a 401(k) to a Traditional IRA. However, if the plan has a Roth IRA component, the Roth portion would be rollover to a Roth IRA. In this case, the 401(k) would be rolled over to two different IRA accounts, a Traditional IRA and a Roth IRA.

Can I rollover a 401(k) to a Roth IRA? 

Yes. You can Rollover a 401(k) to a Roth IRA but, it requires an additional step. First, your rollover would go into a Traditional IRA. Then, you would need to convert the Traditional IRA to a Roth IRA. 

How do I transfer a 401(k) to an IRA? 

You can transfer a 401(k) to an IRA if you have left a job. First, open or establish an IRA at IRAR and complete our Rollover Certification Form. Then, contact your plan administrator and request the forms that you need to complete to move the plan assets or retirement savings to the self-directed IRA. The transfer of accounts can be done from one custodian to the other.

How do I transfer an IRA from one institution to another? 

To transfer an IRA from one institution to another, you must open an IRA account where you are moving the old IRA. First, complete an IRAR  New Account Application and Transfer Form. You will submit these with a copy of your ID and an account balance or statement report for the old IRA. IRAR will send the request to your current custodian to begin the process and get the account transferred over.

What is the difference between a transfer and a rollover? 

Although both rollovers and transfers allow you to move your retirement savings from one financial institution to another, the process for each is different, and each have different rules. A rollover occurs when you move retirement funds from an employer-sponsored plan (like a 401k) to an IRA. A transfer occurs when you move one IRA to another IRA.

Rollover Rules and Transfer Tips to Move Your IRA or 401(k)

Get the Transfer/Rollover Guide Delivered To Your Inbox.