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 403(b) Plan Tutorial.)
The Advisor Insight
Yes, you can roll over the funds from your 403(b) plan into an IRA, but there are a few other options that you should think about as well.
You can roll over the funds into another retirement plan, cash out your 403(b) plan, or keep the funds in the 403(b) plan. The decision will depend on your work situation, your investment experience, the costs of various investment choices, and your goals for investing the funds.
Be sure to research how much it will cost to invest. The internal expense ratio of the funds can vary significantly. You may also consider keeping the funds in your 403(b) plan if you are between jobs and do not want to actively manage your investments. You can do so if you have a balance of more than $5,000.
Halbert Hargrove Global Advisors, LLC
Long Beach, CA