401k roll over question
I recently switched companies so I transferred my previous 401k to vanguard. I rolled over $30k that went straight into a vanguard money market. Would you guys recommend investing that $30k immediately into index funds or dollar cost average? If dollar cost average, what frequency (amount/month) should I invest in? Bonus: fund recommendations?
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Apple kalank Apr 13, 2019
If you invest in a 401k rollover IRA then you won’t be able to reap complete benefits of a backdoor Roth IRA later on.
Zillow Group qpwoeirutl Apr 13, 2019
can u elaborate pls
Credit Karma kqqo46 Apr 13, 2019
U cant choose which dollars get converted during backdoor if u have existing ira. Look up pro rata rule.
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qeerty Apr 13, 2019I did the same and then converted to Roth IRA. I’m a bit fan of vanguard index funds
"All my money was invested. Should I pull out all of my money and slowly reinvest it?" This is equivalent to your question. Dump it back in the market immediately. Bonus: I'm lazy so target date fund for your risk appetite. Otherwise Total Stock Market/Total Bond Market/Total International Stock/Total International Bond in equivalent ratios.
For future reference, it's often possible to do 401(k) rollovers in-kind, meaning that your investments won't be liquidated but just directly transferred to the IRA. See https://thefinancebuff.com/rollover-401k-stay-in-market.html