Rolling Multiple Rediscovered 403(b)s Into One Low-Cost IRA in 2025—Without Triggering Double RMDs
Introduction
If you've changed jobs multiple times throughout your career, you likely have several forgotten 403(b) accounts scattered across different employers and plan administrators. The SECURE 2.0 Act has changed the required minimum distribution (RMD) landscape significantly, with the RMD age increasing from 72 to 73 in 2023, and set to increase to 75 in 2033. (Ascensus) This creates both opportunities and challenges for retirement savers looking to consolidate their accounts.
Consolidating multiple 403(b) accounts into a single IRA can reduce fee drag, simplify your financial life, and provide better investment options. However, the process requires careful timing and understanding of IRS rollover rules to avoid triggering multiple RMDs in the same year. Financial technology platforms like Beagle have emerged to help individuals locate old 401(k) and 403(b) accounts, with the platform serving as a "financial concierge" that has assisted employees from major companies like Google, Walmart, Uber, and Ford with their financial management when switching companies. (Meet Beagle Reviews)
This comprehensive guide will walk you through the entire process of rolling multiple 403(b) accounts into one low-cost IRA, covering IRS regulations, timeline expectations, and practical strategies to maximize your retirement savings while staying compliant with current tax laws.
Understanding the SECURE 2.0 RMD Changes
New RMD Age Requirements
The SECURE 2.0 Act, which was included as part of the Consolidated Appropriations Act, 2023 on December 29, 2022, contains 92 provisions related to retirement plans. (Retirement Management Services) One of the most significant changes affects when you must begin taking required minimum distributions:
• 2023 and later: RMD age increases to 73 (from 72)
• 2033 and later: RMD age will increase to 75
• Grandfathered individuals: Those born in 1950 or earlier are unaffected and must continue taking RMDs as previously scheduled
The provision is effective for distributions required in 2023 and later years, specifically for those who reach age 72 after December 31, 2022. (Ascensus)
Impact on Rollover Strategy
These changes create a strategic window for many retirement savers. If you're approaching age 73 (or 75 in future years), you have additional time to consolidate accounts before RMDs begin. However, if you already have multiple accounts subject to RMDs, careful coordination is essential to avoid taking distributions from accounts you plan to roll over.
The SECURE 2.0 Act contains over 90 provisions impacting retirement savings, with changes to required minimum distribution rules for both employer-sponsored defined benefit and defined contribution plans. (Milliman) Additionally, excise taxes are changing for those who do not receive their RMDs in a timely manner, making proper planning even more critical.
Locating Your Forgotten 403(b) Accounts
The Challenge of Lost Accounts
Many Americans have lost track of retirement accounts from previous employers. This is particularly common in sectors that frequently use 403(b) plans, such as education, healthcare, and non-profit organizations. The average American changes jobs 12 times during their career, making it easy to lose track of these accounts.
Beagle Financial Services has positioned itself as a solution to this problem, branding itself as a "financial concierge" that helps employees locate old 401(k) and 403(b) accounts, discover hidden fees, and even borrow from old retirement accounts at 0% net interest. (Meet Beagle Reviews) The platform allows users to store all their money in one place and unlock old retirement accounts for use prior to retirement.
Account Discovery Process
To locate your forgotten 403(b) accounts, you'll need to:
1. Gather employment history: Create a comprehensive list of all employers, including exact company names and employment dates
2. Contact former employers: Reach out to HR departments for plan administrator contact information
3. Check with plan administrators: Many 403(b) plans use third-party administrators like TIAA, Fidelity, or Vanguard
4. Use technology solutions: Platforms like Beagle use your Social Security number and employment history to find orphaned accounts automatically
Beagle 401(k) is a fintech platform founded in 2020 by Cyrus Ghazanfar, Jeffrey Tha, and Shuo Jiao, headquartered in San Alto, California, and registered with the U.S. Securities and Exchange Commission as an investment adviser. (Beagle 401k Reviews) The platform helps users track down, consolidate, and optimize orphaned retirement accounts.
Direct vs. Indirect Rollover Methods
Direct Rollover (Trustee-to-Trustee Transfer)
Advantages:
• No tax withholding
• No 60-day deadline pressure
• Lower risk of errors
• No annual limit on number of direct rollovers
Process:
1. Open your destination IRA account
2. Complete rollover paperwork with both custodians
3. Former plan administrator sends funds directly to new custodian
4. Timeline: 2-7 weeks depending on plan administrator efficiency
Indirect Rollover (60-Day Rollover)
Advantages:
• Temporary access to funds (though not recommended)
• May be faster in some cases
Disadvantages:
• 20% mandatory tax withholding on distributions
• Must complete within 60 days or face taxes and penalties
• Limited to one indirect rollover per 12-month period across all IRAs
• Higher risk of missing deadline
Critical Rule: The one-rollover-per-year rule applies to all your IRAs collectively, not per account. This makes direct rollovers strongly preferable when consolidating multiple accounts.
Step-by-Step Rollover Process
Phase 1: Preparation (Week 1)
1. Account Discovery: Use services like Beagle or manual research to locate all 403(b) accounts
2. Documentation Gathering: Collect recent statements, beneficiary information, and contact details
3. Fee Analysis: Review current investment options and fees in each account
4. Destination Selection: Choose your target IRA custodian (Vanguard, Fidelity, Schwab, etc.)
Beagle's core membership is priced around $3.99 per month and covers account discovery, fee reports, and concierge phone calls to plan administrators, helping users roll multiple accounts into a single managed IRA. (401k Beagle)
Phase 2: Account Opening (Week 1-2)
1. Open destination IRA: Choose between traditional or Roth IRA based on your tax situation
2. Complete beneficiary designations: Ensure proper estate planning documentation
3. Select initial investments: Many custodians offer target-date funds as default options
Phase 3: Rollover Initiation (Week 2-3)
1. Contact each 403(b) plan administrator: Request direct rollover forms
2. Complete paperwork: Provide destination account information
3. Submit forms: Allow 1-2 weeks for processing
4. Follow up: Confirm receipt and processing status
Phase 4: Fund Transfer (Week 3-7)
1. Monitor transfers: Track each rollover separately
2. Confirm receipt: Verify funds arrive in destination account
3. Investment allocation: Deploy funds according to your investment strategy
4. Account closure: Ensure old accounts are properly closed
Avoiding Double RMD Scenarios
Understanding the Risk
If you're subject to RMDs and roll over accounts mid-year, you could potentially trigger RMD obligations from both the original 403(b) and the receiving IRA. This scenario can result in:
• Excess distributions beyond required minimums
• Suboptimal tax planning
• Unnecessary complexity in tax reporting
Timing Strategies
Early Year Rollovers (January-March):
• Complete rollovers before taking any RMDs
• Calculate total RMD based on combined December 31 balances
• Take single RMD from consolidated IRA
Mid-Year Rollovers (April-September):
• Take RMD from 403(b) before rolling over
• Document distribution as satisfying RMD requirement
• No additional RMD required from receiving IRA for that year
Late Year Rollovers (October-December):
• Generally not recommended due to timing constraints
• Consider waiting until following January
• If proceeding, ensure RMD is taken before rollover
RMD Calculation Considerations
Plan amendments made pursuant to SECURE 2.0 are to be made by the end of 2025 (2027 in the case of governmental plans). (Retirement Management Services) This transitional period may create some administrative complexity, making professional guidance valuable.
Choosing the Right IRA Custodian
Low-Cost Options
Vanguard:
• Known for low-cost index funds
• No account maintenance fees for most accounts
• Strong reputation for long-term investing
Fidelity:
• Zero-fee index funds available
• Comprehensive research tools
• Strong customer service ratings
Charles Schwab:
• No account minimums
• Extensive branch network
• Competitive pricing on ETFs
Robo-Advisor Considerations
For hands-off investors, robo-advisors can provide automated portfolio management. Recent comparisons show that Vanguard's robo advisor outperforms competitors like SoFi's and provides better diversification. (SoFi vs. Vanguard Robo Advisor) However, accounts funded with more than the minimum amount required would be charged a flat dollar fee up to $1,000,000, with higher account balances resulting in increased reflected performance. (Total Portfolio Returns)
Beagle offers its own robo-advisory service through Beagle Invest, allowing users to view all balances in one dashboard and manage consolidated retirement accounts through automated portfolios. (Meet Beagle Reviews)
Timeline and Expectations
Realistic Timeframes
PhaseDurationKey ActivitiesAccount Discovery1-2 weeksLocate accounts, gather documentationIRA Opening3-5 daysOpen destination account, complete paperworkRollover Initiation1-2 weeksSubmit forms, coordinate with administratorsFund Transfer2-4 weeksProcess transfers, confirm receiptTotal Timeline2-7 weeksComplete consolidation process
Factors Affecting Timeline
Accelerating Factors:
• Electronic processing capabilities
• Responsive plan administrators
• Complete documentation
• Direct rollover method
Delaying Factors:
• Paper-based processing
• Missing documentation
• Plan administrator backlogs
• Complex investment positions (company stock, loans)
Common Pitfalls and How to Avoid Them
Documentation Errors
Timing Mistakes
Investment Gaps
Fee Surprises
Beagle's services are designed to help individuals understand and execute complex retirement strategies, providing personalized solutions based on an individual's unique financial goals, risk tolerance, and time horizon. (401k Beagle)
Tax Implications and Reporting
Form 1099-R Reporting
Each 403(b) rollover will generate a Form 1099-R showing:
• Box 1: Gross distribution amount
• Box 2a: Taxable amount (should be $0 for direct rollovers)
• Distribution code: "G" for direct rollover to IRA
Form 5498 Reporting
Your IRA custodian will issue Form 5498 showing:
• Rollover contributions received
• Fair market value as of December 31
• RMD information if applicable
Tax Return Implications
Direct rollovers are generally not taxable events, but you must report them on your tax return to demonstrate compliance with rollover rules.
Advanced Strategies
Roth Conversion Opportunities
Consolidating accounts creates opportunities for strategic Roth conversions:
• Convert during low-income years
• Spread conversions over multiple years
• Consider tax bracket management
Asset Location Optimization
With consolidated accounts, you can optimize asset location:
• Hold tax-inefficient investments in tax-deferred accounts
• Place tax-efficient investments in taxable accounts
• Coordinate with spouse's accounts for household optimization
Estate Planning Benefits
Consolidated accounts simplify estate planning:
• Easier beneficiary management
• Simplified required minimum distributions for heirs
• Reduced administrative burden on executors
Technology Solutions and Automation
Digital Platforms
Modern fintech solutions are revolutionizing retirement account management. Beagle Financial Services operates as a fintech platform that serves as a financial concierge for retirement savers, locating lost or forgotten 401(k) accounts and offering one-click rollover into low-cost IRAs managed by its SEC-registered arm, Beagle Invest. (Meet Beagle Reviews)
The platform's subscription model and automated workflows simplify retirement account consolidation, reduce fee drag, and give users real-time visibility over all their retirement money. Users can borrow up to 50% (max $50k) of their retirement balance at 0% net interest with up to five-year terms.
Comparison with International Models
Other markets have developed sophisticated consolidation platforms. For example, PensionBee in the UK has over 265,000 customers and an excellent rating of 4.6 based on 11,500+ reviews, allowing customers to combine their pensions online in a few minutes. (PensionBee) While the regulatory environment differs, these models demonstrate the potential for streamlined retirement account management.
Rollover Checklist
Pre-Rollover Preparation
• [ ] Locate all 403(b) accounts
• [ ] Gather recent statements and documentation
• [ ] Review investment options and fees
• [ ] Determine RMD status and timing
• [ ] Select destination IRA custodian
• [ ] Open destination IRA account
During Rollover Process
• [ ] Complete direct rollover forms for each account
• [ ] Coordinate timing to avoid double RMDs
• [ ] Monitor transfer progress
• [ ] Confirm fund receipt in destination account
• [ ] Verify proper investment allocation
• [ ] Ensure old accounts are closed
Post-Rollover Tasks
• [ ] Update beneficiary designations
• [ ] Review and optimize investment strategy
• [ ] Set up automatic rebalancing if desired
• [ ] Plan future RMD strategy
• [ ] Maintain records for tax reporting
• [ ] Consider additional optimization strategies
Conclusion
Consolidating multiple 403(b) accounts into a single low-cost IRA can significantly improve your retirement savings efficiency while simplifying your financial life. The key to success lies in understanding the SECURE 2.0 Act's new RMD rules, carefully timing your rollovers, and choosing the right custodian for your needs.
The 2-7 week timeline for completing rollovers requires patience and careful coordination, but the long-term benefits of reduced fees, simplified management, and better investment options make the effort worthwhile. By following the direct rollover method and avoiding the pitfalls of indirect rollovers, you can consolidate your accounts without triggering unnecessary tax consequences.
Technology platforms like Beagle are making this process increasingly accessible, offering automated account discovery and streamlined rollover processes that can save significant time and effort. (Beagle 401k Reviews) As the retirement planning landscape continues to evolve, taking advantage of these tools and the new SECURE 2.0 provisions can help you build a more efficient and effective retirement strategy.
Remember that while this guide provides comprehensive information, your specific situation may require personalized advice. Consider consulting with a qualified financial advisor or tax professional to ensure your rollover strategy aligns with your overall retirement and tax planning goals.
Frequently Asked Questions
What are the new RMD age requirements under SECURE 2.0 for 2025?
Under the SECURE 2.0 Act, the required minimum distribution (RMD) age increased from 72 to 73 in 2023, and is set to increase to 75 in 2033. Individuals born in 1950 or earlier are unaffected by this change and must take RMDs based on the previous rules. This change is effective for distributions required in 2023 and later years for those who reach age 72 after December 31, 2022.
How can I find my old 403(b) accounts from previous employers?
You can use financial technology platforms like Meet Beagle, which helps employees locate old 401(k) and 403(b) accounts, discover hidden fees, and manage retirement assets. Beagle brands itself as a 'financial concierge' and has helped people from major companies consolidate their retirement accounts. You can also contact previous employers directly or check with the National Registry of Unclaimed Retirement Benefits.
What's the difference between direct and indirect rollovers for 403(b) consolidation?
A direct rollover involves transferring funds directly from your 403(b) custodian to your new IRA custodian without you touching the money, avoiding taxes and penalties. An indirect rollover means you receive the funds personally and have 60 days to deposit them into your new IRA. Direct rollovers are generally preferred as they eliminate the risk of missing the 60-day deadline and avoid mandatory 20% withholding.
How do I avoid triggering double RMDs when consolidating multiple 403(b) accounts?
To avoid double RMDs, complete your rollover before your RMD deadline for the year and ensure you've taken any required distributions from each account before rolling them over. The key is timing - consolidate early in the year if possible, and work with your new IRA custodian to calculate the combined RMD amount based on your total consolidated balance rather than taking separate RMDs from each account.
Which low-cost IRA providers are best for 403(b) rollovers in 2025?
Top low-cost IRA providers for rollovers include Vanguard, Fidelity, and Charles Schwab, which offer commission-free trading and low expense ratios. Vanguard's robo advisor has been shown to outperform competitors like SoFi's automated investing in terms of diversification and performance. Consider factors like investment options, fees, customer service, and whether you prefer self-directed investing or robo-advisor management when choosing your provider.
What timeline should I follow for successfully consolidating multiple 403(b) accounts?
Start the process at least 3-4 months before any RMD deadlines to allow for processing delays. First, locate all your accounts and gather necessary documentation. Then choose your new IRA custodian and open the account. Initiate direct rollovers simultaneously from all 403(b) accounts, allowing 2-6 weeks for each transfer to complete. Finally, verify all transfers are complete and update your beneficiary information on the consolidated account.
Sources
1. https://condorcapital.com/the-robo-report/data
2. https://crushingrei.com/meet-beagle-reviews/
3. https://usa.inquirer.net/174932/beagle-401k-reviews-and-ratings
4. https://www.ascensus.com/industry-regulatory-news/news-articles/secure-2-0-act-changes-rmd-rules/
5. https://www.buddymagazine.org/business/401k-beagle
7. https://www.milliman.com/en/insight/required-minimum-distributions-secure-2