What is a 60-day rollover? A 60-day rollover is the distribution of funds from a qualifying retirement account payable to the account owner who then has 60 days to redeposit the funds into another qualifying retirement account.
- Do trustee-to-trustee transfers instead. The best way to avoid making a 60-day rollover mistake is to avoid 60-day rollovers! Transfer your funds directly to another retirement account. Not only does a direct transfer avoid any 60-day time problems, but if the rollover is coming from a 401(k) or other qualified plan, it will also avoid the mandatory 20% withholding requirement.
- Make checks payable to new IRA custodians. Sometimes the only way a custodian will distribute an IRA or other retirement account money is in the form of a check. There is a special rule that allows a distribution by check to qualify as a direct rollover (and avoid the 60-day rules) when the check is made payable to the new IRA. For example, your check might read “Custodian X f/b/o (for benefit of) John Doe IRA.”
- Keep track of when you receive your distribution. Few people know when the 60-day clock actually begins. It starts when you receive the distribution. The few days between when the check was issued and when you actually received it may make all the difference in the world.
- Check to make sure the funds were deposited into the correct account. A common mistake occurs when funds are accidentally deposited into a non-retirement account. Once you’ve deposited the funds or sent them to your financial institution, take five minutes out of your day to make sure they have arrived at their intended destination. If the mistake is discovered within 60 days it can be corrected.
- Be aware of the once-per-year IRA rollover rule. You are limited in the number of 60-day rollovers you can make in a 365-day period. The once-per-year rollover rule applies only to 60-day rollovers from IRA to IRA or from Roth IRA to Roth IRA. Under the rule, once funds have been rolled over as a 60-day rollover, no other 60-day rollovers can be done by the account owner within the next 365 days. For this rule, IRAs and Roth IRAs are counted together.
If you’ve switched jobs in the past few years, chances are you’ve got an old 401k sitting somewhere, collecting dust and possibly fees. Today, Frank answers a listener’s question about what to do with old 401ks, when a rollover might make sense, and how to avoid common pitfalls when making the switch.
When do multiple beneficiaries exist? Multiple beneficiaries exist when an individual names more than one beneficiary for their IRA. When should you name more than one beneficiary? When you want your IRA assets to go to more than one person or entity without having to incur additional fees or paperwork by maintaining separate accounts for each beneficiary.
If I miss the 60-day deadline for completing an IRA rollover, is there any way to save the rollover amount from tax? Failing to complete a 60-day rollover on time can cause the rollover amount to be taxed as income and perhaps subject to a 10% early withdrawal penalty. However, the deadline may have been missed due to reasons that are not the taxpayer’s fault. Fortunately, for such cases, the IRS has created an easy, low-cost way to fix late rollover errors. Revenue Procedure 2016-47 enables individuals to self-certify that they are eligible for a waiver of the 60-day deadline and complete a late rollover
Plenty of people have concerns about stock market volatility, a potential recession on the horizon, and worries for the economy amidst recent news. What if you’ve had 2025 marked on the calendar for a while as the year you plan to retire? Is this a bad time to do it?
Market volatility has a way of shaking confidence. It's easy to feel uncertain, but reacting without a plan could do more harm than the drop itself. In this special mailbag episode, Frank tackles timely listener questions about navigating today’s uncertain market.
When the market is volatile, it's easy to feel like you're the only one who's ever felt this anxious. But some of the greatest investors in history have lived through chaos, and they left behind wisdom that still applies today. In this episode, Frank turns to voices like Warren Buffett, Benjamin Graham, and Jack Bogle to remind us how to stay grounded when everything feels uncertain.
When markets are shaky, it’s tempting to pull your money out and “wait for things to settle.” But what if that instinct could cost you in lost growth? In this episode, Frank shares compelling statistics on what happens when investors miss the best days in the market, and how a few wrong moves could potentially reduce your long-term returns.
What happens when you make too much money to contribute to a Roth IRA? In today’s episode, we open the mailbag to answer a listener’s question about what tax-advantaged opportunities exist when a Roth isn’t on the table.
Can children have IRAs?
How can I avoid making costly mistakes when I inherit an IRA from a person who was not my spouse?
