General question about moving workplace savings

[ua_guy]

As part of my goals this year, I am consolidating an old savings plan from a former employer into an existing IRA. I made the request and it's pending spousal consent (we have to go get a few documents notarized).

I've been hesitant to do anything while watching the market drop precipitously. I don't think it makes a big difference to sell "low" and then immediately re-invest while the market is low. I think the biggest thing I need to be cautious of is say, selling today while the market is off 10%, and then re-investing on say, Wednesday, and let's assume the market has lost another 3%. I'd solidify that additional 3% loss. I would need to do this at a time when the market is generally treading water.

Is this general thinking correct? I want to consolidate my accounts but also don't want to do something stupid that I'm not thinking of.

[LivingAlmostLarge]

can you do a transfer of assets so you sell and move out of zero positions?

[disneysteve]

As part of my goals this year, I am consolidating an old savings plan from a former employer into an existing IRA. I made the request and it's pending spousal consent (we have to go get a few documents notarized).

I've been hesitant to do anything while watching the market drop precipitously. I don't think it makes a big difference to sell "low" and then immediately re-invest while the market is low. I think the biggest thing I need to be cautious of is say, selling today while the market is off 10%, and then re-investing on say, Wednesday, and let's assume the market has lost another 3%. I'd solidify that additional 3% loss. I would need to do this at a time when the market is generally treading water.

Is this general thinking correct? I want to consolidate my accounts but also don't want to do something stupid that I'm not thinking of.

If the prices drop during the transition, that's to your benefit. It's the opposite that's the problem. If you sell today and the market rises before you get back in, then you've missed that gain.

That said, there's no way to know so just ignore it and make the move. It's impossible to know what will happen during the transition so it's not something you can possibly prepare for either way.

[Fishindude77]

That said, there's no way to know so just ignore it and make the move.

This is the correct move in my opinion.
Nobody has a crystal ball and can accurately predict what is going to happen in the market.

[ua_guy]

If the prices drop during the transition, that's to your benefit. It's the opposite that's the problem. If you sell today and the market rises before you get back in, then you've missed that gain.

That said, there's no way to know so just ignore it and make the move. It's impossible to know what will happen during the transition so it's not something you can possibly prepare for either way.

Yes, you are correct. I'm in a brain-fog this morning.

I'm not necessarily trying to time the market, but it usually takes a couple days to process the transfer and things are up/down right now (mostly down). Unfortunately I won't be able to do a transfer...it's in a really cruddy target-date fund that only appears to be available to that plan/company. I remember the choices being awful. So, it has to be sold and then I can keep it as cash or distribute to my index funds I have in my IRA.

[disneysteve]

I'm not necessarily trying to time the market, but it usually takes a couple days to process the transfer and things are up/down right now (mostly down).

Right now the DJIA is up 461.

You can't time the market.

[kork13]

One other note -- if you're doing a traditional-to-Roth conversion, then the lower the market is during the transition, the better. Lower values means you're paying less taxes on the conversion.

This is what I'm aiming at for DW.... Except we're so busy I don't have the brain space to work through all the paperwork for the conversion. They really don't make it easy at all......

[bjl584]

As part of my goals this year, I am consolidating an old savings plan from a former employer into an existing IRA. I made the request and it's pending spousal consent (we have to go get a few documents notarized).

I've been hesitant to do anything while watching the market drop precipitously. I don't think it makes a big difference to sell "low" and then immediately re-invest while the market is low. I think the biggest thing I need to be cautious of is say, selling today while the market is off 10%, and then re-investing on say, Wednesday, and let's assume the market has lost another 3%. I'd solidify that additional 3% loss. I would need to do this at a time when the market is generally treading water.

Is this general thinking correct? I want to consolidate my accounts but also don't want to do something stupid that I'm not thinking of.

I'd say that logic would only apply if you were going to cash out the plan and then immediately reinvest in the same exact securities.
That probably won't be the case.
When I did a rollover I ended up putting the money into totally different funds.
I suppose it matters what you sell and what you end up buying.
Over the long run it probably won't matter so much