QUESTION:
I have a Simple IRA and a Rollover IRA currently at Fidelity. I had initially thought I would transfer the Rollover account into this new self-directed 401k trust. Would there be any issues or something I should be aware of if I consolidated and moved both accounts into the solo 401k trust? Assets are about $250K and $210K respectively at the current time.
ANSWER:
As long as you have had the SIMPLE IRA for at least 2 (two) years, it can be transferred to the solo 401k plan. A solo 401k is often used to consolidate retirement accounts such as traditional IRAs, SEP and SIMPLE IRAs as well as former employer plans such as 401k plans, profit sharing plans, 403(b)s, TSPs, 457b and pensions. By consolidating, retirement funds into a solo 401k plan, the solo 401k participant will have more funds to invest in alternative investments such as real estate, notes, metals, tax liens, and private companies, to name a few, as well as traditional investments such as equities. The solo 401k participant can also maximize the amount of funds that they can borrow from the solo 401k through a solo 401k participant loan.
