I am 55 years old and going through a divorce. My husband is giving me his entire 401(k) plan funds. Can I leave it with his company 401(k) plan, or do I have to roll over the 401(k) plan to an Individual Retirement Account (IRA)? I know I have to be 59 1/2 before I can start to withdraw any monies.
According to FPA member W. Aubrey Morrow, CFP®, of Financial Designs, Ltd., it's unlikely that you will be able to maintain your husband's 401(k) plan at his employer. "The best plan of action would be to contact the plan administrator at his company and ask how to transfer those funds to you," said Morrow. "My suggestion is for you to do an IRA rollover into your own account and speak with the investment firm that currently has the 401(k) for the recommended asset allocation based on your goals and objectives, risk tolerance and time horizon."