Now that you are no longer working with the (former) employer that established your 403(b) account, you may roll your 403 (b) balance to your Traditional IRA.
Generally, only a signed contribution form is required by the IRA custodian/trustee to deposit the funds to your IRA. However, to be sure, consult with your IRA custodian regarding its policies and procedures. This will prevent any unnecessary delays.
You should also consult with your 403(b) plan administrator/carrier to ensure the proper paperwork is completed. You may need to complete a distribution request form in order to have the assets distributed. The administrator may also require an acceptance letter from your IRA custodian. This serves as a confirmation that the assets will be deposited to an eligible retirement plan.
Finally, make sure the transaction is processed as a "direct rollover." This means that any funds distributed are made payable to your IRA custodian and are usually sent directly to them. If the funds mare made payable to you, the 403(b) administrator is generally required to withhold at least 20% for federal taxes.
(To read more, check out and 403(b) Plan Tutorial.)
This question was answered by Denise Appleby
Yes. You will likely need to establish the IRA first (at a brokerage firm, mutual fund company or bank, typically) and then complete paperwork supplied by your former employer. The paperwork instructs the former employer to sell the assets currently held in your 403(b) and send the cash proceeds to your new IRA custodian.
In some cases, employers permit "in-service" rollovers, meaning you could roll over 403(b) assets into an IRA while still working for the employer.
Yes, you should be able to perform a rollover of funds from a 403(b) to a Rollover IRA. You should check the rules of your specific plan as each 403(b) & 401(k) plan may contain special rules or provisions.
Consider that some plans (typically those with more assets) may be low cost and offer lots of investment options. Conversely, many plans entail additional expenses for services related to qualified retirement plans (recordkeeping, plan administration, etc.) and may have limited investment options to select.
Also be aware that if a vesting schedule exists, you may not have access to a certain portion of the funds contributed by your employer. These rules would be specific to your employer’s plan.
If you are no longer employed by the institution that provided the 403(b) you will be able to roll it into an IRA (usually called a Rollover IRA or RO-IRA for short).
But is this is right for you?
We sometimes find that our clients benefit from retaining their 401K/403b plans whereas other times it is better if the roll it out. I recommend that you examine the 403b plan before doing a rollover. Most are costly and have poor investment choices but some have excellent investment choices and are low cost. It may be to your advantage to rollout if your 403b is the costly with poor investment choices type (the former) but it may be worth retaining your current 403b plan if it is the latter (or the low cost with excellent choices).
When it comes to qualified plans always check several sources or connect with a knowledgeable fiduciary advisor before you act. Actions that are right for some may not be right for you.