Can I move a retirement account from a previous employer to a Roth IRA? OR does it have to be a rollover Roth IRA?

💰 Everyday Islamic Finance Savings & Investing
#1

I already have a Roth IRA and not sure if I can transfer money from a plan with a previous employer (i.e. 403(b)) to it or if I should open a rollover Roth IRA
Thanks

#2

Rolling over a traditional 403(b) to a Roth IRA may trigger a taxable event since you’re moving from a pre-tax account to a post-tax account. You you may want to consider a traditional IRA instead. Also, make sure you don’t do this manually by withdrawing funds and then depositing them yourself. Instead, just create an IRA account and then inform your former employer to send the money directly to the IRA custodian.

If you have an account with one of the big guys like Schwab or Fidelity, reach out to their support team and they should be able to help you through process.

#3

Thanks for your response, Saad. Why would you think a traditional account is better although I have to pay taxes on the capital gain when it comes to the traditional account?