Hi PFC team, I love the course! [ I hope this is the right place to submit the office hours questions :B]
It was mentioned it would be better to do a direct roll over (avoiding fees) of the previous employer 401K to a traditional IRA, however, if I’m interested in Roth IRAs in general, it is still recommended to open a Traditional IRA just to rollover the old 401K? (versus a Roth one / keeping it where it is/ combining it with new employer).
Thank you tons!
You can rollover from 401k to Traditional IRA, since both are (were) funded with PRE-tax money
To go from 401K to ROTH IRA, you would need to do the Backdoor method, since ROTH is funded with AFTER-TAX money.
HTH
I’ll cover this in tonight’s office hours (3/24/2021) with the recording available afterwards on the course site!
If you’re not signed up for office hours, you can sign up here.