#173 Think Twice Before Rolling Your Old 403(b) into a Traditional IRA

When you change jobs, a rollover rep may offer to help move your old retirement account, stressing how much control you'll have over your investment options in an IRA. But is that what this decision is really about?

Nate Reineke and Chelsea Jones take a question from an OBGYN in South Carolina moving about $400,000 from former employers. A rollover rep is steering them toward an IRA instead of their new 403(b). Nate and Chelsea unpack what that call is really offering: an account with potentially higher investment management fees, plus a tax wrinkle many physicians miss. Pre-tax dollars in a traditional IRA can complicate a future Backdoor Roth. Rolling old funds into the new 403(b) is often worth a look, though the right move depends on your situation. We also answer your colleagues' questions. An Emergency Medicine Doc in Washington wonders, “We have about $5,000 in credit card debt, no emergency fund, and we want to start investing. Should we crush the debt, build savings, or start investing first?” An Orthopedic Surgeon in Ohio asks, “I have a practice partnership buy-in coming in about two years, and it looks like I'll either have to pay cash or take a roughly cut-in-half salary for two years to fund it. Should I take the salary reduction, or find another way?” An Orthopedic Surgeon in New York says, “I'm thinking about a "coast FIRE" approach or a mini-retirement so I can be more present while our kids are still at home. Is it financially feasible for us to pause or scale back mid-career?” Are you ready to turn worries about taxes and investing into a plan for college and retirement? If you’re evaluating your options and want to learn more, visit physicianfamily.com and click 'Get Started' or you can ask a question of your own by emailing podcast@physicianfamily.com. See marketing disclosures at physicianfamily.com/disclosures