Any financial advisors out there...401K to Roth question

[ChicosBailBonds]

Question for you

[Marqevans]

What's your question?  I have 25 years in the business.

[Josey Wales]

What's your question?  I have 25 years in the business.

Are you hiring? 

[ChicosBailBonds]

What's your question?  I have 25 years in the business.

With all this talk of converting 401Ks to Roth IRAs, can this be done to an existing 401K that one is still contributing to?  I've been told no, but not sure if that is accurate.

[Marqevans]

I have replied to the email address in your profile.  By the way do you have a softball team in Vernon Hills, IL that goes by your sign-in name.

[Tortuga94]

With all this talk of converting 401Ks to Roth IRAs, can this be done to an existing 401K that one is still contributing to?  I've been told no, but not sure if that is accurate.

If you are over 59 1/2 some plans do allow an in-service rollout.  In which case you could roll it into a traditional IRA or convert it to a Roth.  So it depends on your employer's plan.  If you are not 59 1/2 then you are most likely not going to a be able to rollover your 401K assuming you are still employed and contributing.

[TomW1365]

It looks like we have a few good answers on the board.  You cannot convert your existing 401k (that you are contributing to) over to a Roth IRA.  While there has been a lot of hype on this subject, and while I have this conversation with clients w/ old 401k's or IRAs, the out of pocket expense to pay the taxes have usually nixed this idea.  I think it's being used as a marketing tool by investment firms to find new clients.  We haven't seen an overwhelming benefit, but owe it to people to use a conversion calculator (that can be found online) to determine if it's in their best interest.  Those that have the liquid dollars usually choose to keep or save the dollars that would be due to the IRS over the next two years.  If you don't normally qualify for a Roth IRA due to income limits, there are other attractive tax efficient options for future dollars.  I've heard of some that use this conversion strategy on smaller accounts and/or some who are banking losses or stepping up their basis for tax purposes.    

I have operated my practice with Northwestern Mutual Financial Network in the Chicagoland area for ten years.  http://thomaswalsh.nmfn.com/  Feel free to email/call if I can be of help.  Heading to Milwaukee this weekend for the company's annual meeting. 

[ChicosBailBonds]

If you are over 59 1/2 some plans do allow an in-service rollout.  In which case you could roll it into a traditional IRA or convert it to a Roth.  So it depends on your employer's plan.  If you are not 59 1/2 then you are most likely not going to a be able to rollover your 401K assuming you are still employed and contributing.

Yeah, I've come to the conclusion due to age and the fact I'm still contributing, this option isn't for me.

[4everwarriors]

Could've sworn you were over 60.

[ChicosBailBonds]

Could've sworn you were over 60.

I feel like it sometimes.

[77ncaachamps]

Could've sworn you were over 60.

No, no, no. You're confusing Chicos with PRN.