Rollovers

Roll over a 401(k), 403(b), IRA, or other retirement plan to Betterment

401(k) Rollovers

Can I roll over my active 401(k) (or other employer-sponsored plan) into Betterment?

Your plan provider likely will not let you roll over a 401(k) while it is still active. This same logic applies to 403(b)s, Pensions and other employer-sponsored retirement plans. For most providers, they require you to be retired or no longer employed at the company to be allowed to roll over retirement funds. Ask your provider to see what their rules are.

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How can I roll over my 401(k) into Betterment?

This entails your current provider sending us a check of your funds directly, for your benefit. Get started today. You'll answer a couple of questions, and receive an email with the full, personalized instructions (how the check should be issued and where it should be sent) to complete your rollover. Please note that Traditional funds must be rolled over into a Traditional IRA and Roth funds must be rolled over into a Roth IRA. If you aren't sure which type(s) of funds you have, contact your ...

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Getting started

What is the difference between a 401(k) and an IRA?

You can, and probably will, end up having multiple retirement accounts, but there are many benefits to maximizing your 401(k) contributions. The biggest difference between the two is contribution limits: an individual can contribute up to $18,000 to their 401(k) account ($24,000 if they are 50 or older), whereas the contribution limit on IRAs is $5,500. If your employer matches your employee deferral contributions, this increases the amount that you are able to save for retirement each year via ...

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Is it possible to roll over my previous 401(k) or an IRA?

Yes! Betterment makes rollovers simple and efficient, minimizing your time spent and keeping costs low so we can maximize your money’s growth. Our rollover process is among the fastest in the industry. Try it out! It is important to note that when deciding whether to roll over an old 401(k) account or other retirement account, you should carefully consider your personal situation and preferences. Relevant factors may include that: (i) 401(k) accounts may offer greater protection from creditors ...

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Can I transfer or roll over an inherited IRA / 401(k) or other retirement plan?

Yes, you can transfer an inherited retirement plan. The process is called a trustee-to-trustee transfer. Your current provider will send us a check of your funds directly, for your benefit. We will assist you throughout the whole transfer and set up process, so if you'd like to get started, please email us. With Inherited IRAs, you may need to take Required Minimum Distributions (RMDs). At this time, Betterment does not automate calculation of RMDs, though we hope to provide this feature in the ...

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Should I roll my funds into my 401(k) or IRA account at Betterment?

If your employer offers a 401(k) through Betterment that permits rollovers into the plan, you have the option to roll your old 401(k) into your new 401(k), or roll it into an IRA. The right decision for you depends on many different factors. This is a general, educational guide that defines the major differences between a Betterment 401(k) and Betterment IRA. It is not a comprehensive list, nor is it a recommendation as to what any particular Betterment customer should do. Some of these factors ...

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IRA transfers

How do I complete a Direct IRA Transfer?

If this is your first direct IRA transfer, don’t worry. We help process direct IRA transfers every day, and we’re here to make it as easy for you as possible. TABLE OF CONTENTS How to Transfer Indirect Rollovers Less Common Special Cases Glossary A direct transfer moves qualified assets directly from one provider to another. No tax consequences: Direct transfers are not counted as distributions or taxable income, therefore they are not subject to any taxes or penalties. No limit: The IRS says ...

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Why do I need to sell my investments at my current IRA provider?

If you want to transfer your IRA to Betterment, you will need to sell your investments. Before we can invest your retirement funds in our fully diversified portfolio, you will need to sell your current holdings at your current IRA provider. Many providers will not accept our liquidation instructions so this will help facilitate this process. Selling your investments at your current provider is often quicker and lower cost than Betterment authorizing this on your behalf. Please note, selling ...

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Can I transfer my spouse’s IRA into my own?

You cannot roll over a spouse's IRA into your Betterment account, as the IRS does not allow for joint ownership of IRAs. Your spouse will need to create their own Betterment account to roll their IRA into. If you and your spouse want to sign up for individual accounts, we can "household" the two accounts which will combine your balances for the purposes of meeting minimum balance requirements at our various pricing plans. Please email us with both of your email addresses if you would like to ...

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How do I perform an IRA transfer or rollover?

Betterment uses a direct transfer process to roll over existing IRAs into Betterment IRA accounts. These transfers are non-reportable transactions, which avoids any tax consequences for the user. In a direct transfer, your current IRA provider generally sends Betterment a check or wire for the value of your account. To get started, go to the Transfer page of your Betterment account and click "Rollover". You'll answer a few questions and receive full instructions to complete your IRA transfer, ...

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Which providers are supported by Betterment’s e-fax IRA rollover process?

The following institutions are supported by Betterment’s e-fax IRA rollover process. American First Benefit Plans Administrative Services Blackrock BMO Harris Bank Capital One Bank Cetera Advisor Networks Charles Schwab CIT Bank Commonwealth Financial Services Community America Credit Union Contra Costa Federal Credit Union Edward Jones Exeter Trust Company Fidelity First Trust Company of Onaga Franklin Templeton FTJ Fundchoice, Interactive Brokers HSBC Invesco Investment Services Jackson Janus ...

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How do I use the indirect rollover process to move my IRA into Betterment?

The indirect rollover process involves withdrawing from your current IRA and re-depositing the funds into another IRA within 60 days. The rule limits the use of an indirect rollover process to once per individual per 12 month period. If you have used this method in the past 12 months, here are instructions to the direct transfer process instead. This method avoids any negative tax consequences and there are just two easy steps: Ask your provider for an early distribution with no withholding. ...

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Can I transfer or roll over my existing SEP IRA to Betterment?

Yes. Start the process today. There are no negative tax consequences for a direct transfer.

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Troubleshooting

Who is Millennium Trust Company, LLC?

Betterment uses Millennium Trust Company, LLC as our IRA administrator and custodian for our IRA accounts. When it comes to an IRA, there are two types of “custodians” playing complimentary roles in ensuring the proper administration and effective management of your account. An IRA is essentially a trust account - an account set aside for a beneficiary (you) for a later time - that receives tax-advantaged benefits in exchange for complying with contribution and distribution restrictions. As ...

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How long does it take for my rollover to be completed?

Generally, it takes 7-10 business days after the funds have left your old provider for the funds to appear into your Betterment account. This includes mail time, processing, and time for the funds to settle. You will be notified via email as soon as the funds appear in your Betterment account. We suggest reaching out to your provider to confirm the date of liquidation. If you still have questions regarding the status of your rollover, please email rollovers@betterment.com.

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What is a medallion signature guarantee?

A medallion signature guarantee is an extra level of security to prevent the unauthorized transfer of your assets. You can obtain a one at a local financial institution with which you have an account. You will need to bring a statement from your current IRA provider to obtain a medallion signature guarantee. Read more about medallion signature guarantees.

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Where do I mail my rollover check?

If you receive a check for a rollover or transfer made out to "Betterment", you can mail the check to one of the two addresses below. These instructions only apply if you’d like to roll your funds into a Betterment IRA. If you’d like to transfer funds into an existing Betterment 401(k) plan through your employer, follow these instructions instead. Regular Address: Betterment P.O Box 203945 Dallas, TX 75320 Overnight Address: Lockbox Services #203945 Betterment 2975 Regent Blvd., Suite 100 ...

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