If you have several IRAs or leftover 401(k) plans from previous employers, this is a perfect time to consolidate them in one IRA rollover account. Not only will this simplify your financial recorded-keeping, but it will create an opportunity to access one of the best and safest investment opportunities for your money. So don’t let your fear of complexity or just plain laziness stand in the way. Here’s how to get started.

Easy Direct Rollover
The first step is to gather the latest statement from each of those scattered retirement accounts. Since many send out statements quarterly, the most recent one may have arrived in early November. It does not matter that your statement is slightly out of date. Do not let that be a reason to procrastinate!

Then contact a high-quality, low-cost custodian such as Fidelity, Vanguard, Schwab, or T.Rowe Price — either through their website or toll-free number. It doesn’t matter whether you use a company where you may already have an IRA, or the company that manages your 401(k). You can also choose a new company to create your rollover account.

When you contact your chosen custodian, don’t be intimidated by all the requests for log-in information. Simply ask to speak to a “retirement rollover specialist.” You may have to repeat yourself. But once you get that department, it will be easy because they do all the paperwork for you.

Your new advisor will contact your old plan custodian(s) and initiate the transfer of funds. That’s why you need all your paperwork, including account numbers, from your existing plans. The money will move directly to the new IRA custodian by bank wire. You do not get a check to redeposit; that could cause all sorts of tax hassles down the road.

The process may take a week or ten days. Finally, you have all your old retirement accounts in one place — except for your existing 401(k) or 403(b) at your current job. Eventually, when you are required at age 72 to take required withdrawals it will be easier to coordinate the timing and amounts.

When you open your new IRA rollover account be sure to name a beneficiary or co-beneficiaries at the time you open the account. You can always easily change that designation, but it’s tempting fate if you don’t name a beneficiary immediately.

Set up online access to your new rollover account. You’ll want to check to make sure all the money arrives. Tell the rollover specialist that it should all go into a money market fund when it arrives.

Note: no pre-existing mutual funds or stockholdings will be transferred in the process. Taxes are not a consideration since all growth of assets in a retirement account are taxed as ordinary income when they are withdrawn. The one exception would be company-issued stock. If you have that, consult with your tax advisor.

Now what? How To Invest
With a giant sigh of relief, in a few weeks you’ll have all your old retirement accounts rolled into one. Then, there’s only one big decision remaining: How to invest the money.

Here’s where the advice depends on your age and personal financial situation.

As a general rule, if you’re under 55, a large portion should still be invested in the stock market — scary as that may seem. Over a 20-year period a diversified stock portfolio, with dividends reinvested, is your best chance at growing wealth and beating inflation. So choose the S&P 500 stock index fund, along with a balanced fund for your stock market exposure. You can move the money gradually into those funds over a few months.

If you’re closer to retirement, you may choose more conservative funds, mostly equity-income and balanced funds. And you may choose to leave a significant money in safer, “chicken money” choices that minimize risk.

And here’s the good news. If you choose one of the custodians names above, you can actually buy Treasury bills at the weekly auctions for your IRA (something you cannot do on your own for your IRA). These custodians are set up to do it for you. So instead of settling for money market low returns inside your IRA, you can capture the current roughly 4.7% return of T-Bills for the next 6 months!

You CAN do this rollover on your own. You don’t have to pay fees to accomplish this, or for unnecessary investment “advice.” It’s your money and you can do this. That’s the Savage Truth!