Do I have to invest my SIMPLE IRA contributions with the company that administers it, i.e. Fidelity?

Question

Or can I invest it wherever I like?

Can I invest it wherever I like while I'm still employed with the same company. For instance, Fidelity administers our program but I would like to invest in Vanguard funds. Can I do this?

Answer 1

You have no choice but invest in the Fidelity funds offered by Fidelity as administrator of your company's SIMPLE IRA plan.

Once you leave that company, you can roll over your SIMPLE IRA vested investments and roll it into a personal traditional IRA (not to be confused with a Roth IRA).

I personally agree with you that Vanguard is a better mutual fund company than Fidelity. On the other hand, Fidelity is a close second. I bet the company's existing SIMPLE IRA plan offers plenty of descent Fidelity mutual funds to choose from to build a descent retirement portfolio.

If you need any clarification, contact me through "Answer." And, I will edit my response accordingly.

You contacted me through "Answer." I was not able to reply you directly. So I am replying here.

You most probably cannot move funds outside of Fidelity under any circumstances as long as you are with your current employer. This is true even if you move your funds to Fidelity's money market fund and then attempt to move these funds outside. You just can't.

Hope that helps.

Answer 2

Yes. If the plan sponsor is a fund company, like Fidelity, all the investment choices are going to be funds from their fund family.

Once you leave the company or your employment is severed, you may open a new simple and roll it to where ever you want.

Answer 3

Talk with your Human Resources Department and see if they offer any choices other than Fidelity