How to Convert 401(k) Accounts to a Self-Managed IRA
- 1). Compare investment companies. A discount brokerage will offer more options, allowing you to invest in stocks and mutual funds. Look at the minimum deposit that you must make and the cost per transaction to make sure you get the best deal.
- 2). Open up your IRA account. You need to tell your 401K manager where to send your money. With any company that offers self-directed IRAs, you can sign up by filling out an application online.
- 3). Contact your 401K company. Talk to someone over the phone. Tell her you want to do a direct 401K rollover. She will ask you the name of the company at which you have your IRA, because the check for the amount in your 401K account will be written to the IRA company. It should take less than two weeks to receive your check.
- 4). Deposit your check into your new IRA account. You have 60 days in which to do this without facing any penalties.
- 5). Allocate your money towards different investments. It's smart to spread your money over different types of investments to balance your risk.
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