College Illinois rollover to a Roth
I am trying to get the balance in my son’s College Illinois rolled over into his Roth.
The balance is approximately 7200.00. College Illinois told me that the limit is 7000.00, and my son needed to call Schwab and get an authorization letter for the rollover. Schwab told him that it has to be spread out over a year, but College Illinois told me that the entire amount has to be rolled over, and the amount cannot be split.
Any suggestions?
Thank you.
Terry Says
Well, first, let me assume that your son earned at least $7,000 from work in 2025. He can only roll to a Roth, if he had earned income during the year.
Second, the limit on Roth contributions at his age (under 50) is $7,000 per year. So that’s where the limit came from. If he had a remaining balance, he could move it into a Roth next year, again assuming he had earned income in that amount.
Now, I have no idea why Schwab would have told him that the amount has to be spread out over a year. Could you please call them and get that in writing. I’m betting that someone made an error.
Act quickly. And if that IS a policy, I’ll contact them and get involved as a columnist. So be sure to get the name of the person to whom you/he spoke, and the phone number, as well as demanding that be sent to you in an email so you have it in writing.
