How to transfer Fidelity 401k to Vanguard
Background
When I started working at VMware in 2019, a 401k account was opened for me with Fidelity. In 2021, I left VMware to join Google which partners with Vanguard for 401k, hence I got a new 401k account with Vanguard. I’ve thought about merging my Fidelity 401k account into my Vanguard 401k account, but I thought it’s better to keep the eggs in different baskets and didn’t do so. One day, when I was checking my Fidelity account’s statement for no reason, I noticed that I was charged $10.25 in the beginning of 2022, which made me wondering what was going on there. It took me about 2 weeks to pick up the phone and call Fidelity’s customer service (because I like to procrastinate on this kind of important but not urgent tasks), and I was told that since I’m no longer employed with VMware, Fidelity will charge me an annual record fee of $51, which was paid by VMware before my departure. This annual fee is spreaded evenly over 4 transactions, and the one I saw was the first payment. This is what prompted me to take action and roll over my Fidelity 401k to Vanguard.
Process
The entire process involves 3 steps.
- Call Fidelity to withdraw all my 401k into a check and mail to me.
- The check needs to be made payable to
Vanguard Fiduciary Trust Company, For the benefit of [Your name](or(VFTC, FBO [Your name])). - If the check is lost or stolen, simply call Fidelity again to issue a new one.
- IIUC, the check needs to be deposited to Vanguard within 60 days, otherwise there will be tax obligation as if this is my ordinary income. If a new check is requested then the 60-day period is reset.
- The check needs to be made payable to
- Complete and print out the rollover form from Vanguard’s website.
- Mail the rollover form together with the check to Vanguard.
- Use the priority mail option from USPS which is faster and provides tracking
Once Vanguard received everything, it completed my rollover on the same day which is pretty impressive.
My case was pretty simple because I only have pre-tax 401k. I was told by the customer service representatives of both Fidelity and Vanguard that it would more complicated if I have Roth or after-tax money.