Empower 401k Rollover: Complete Step-by-Step Guide
How to roll over your Empower (formerly Prudential) 401(k) to an IRA. Detailed instructions for navigating the rollover process.
Key Takeaways
- 1Empower (formerly Prudential Retirement) serves millions of 401(k) participants
- 2Direct rollover avoids the 20% mandatory tax withholding
- 3Process can be started online at empower.com or by calling 1-800-338-4015
- 4Typical rollover processing takes 7-10 business days
- 5Gold IRA provides diversification beyond Empower's fund offerings
Understanding Empower 401(k) Plans
Empower Retirement is one of the largest retirement plan providers in America, serving over 17 million participants. After acquiring Prudential's retirement business, Empower now manages plans for thousands of employers. When you leave your employer, you have the right to roll over your Empower 401(k) to an IRA of your choice.
- **Major provider**: Empower serves 17+ million retirement plan participants
- **Prudential merger**: If your plan was with Prudential, it's now Empower
- **Full rollover rights**: Available when you leave your employer
- **Multiple options**: Roll to any IRA provider - not just Empower
- **Same process**: Whether you quit, retired, or were laid off
When Can You Roll Over Your Empower 401(k)?
You can initiate a rollover from your Empower 401(k) when you have a qualifying event. The most common trigger is leaving your employer.
- **Left your job**: Voluntary resignation or involuntary termination
- **Retired**: Full access to rollover your balance
- **Laid off or downsized**: Rollover eligible immediately
- **Over 59.5 and still employed**: Some plans allow in-service rollovers
- **Plan terminated by employer**: Must distribute within allowed period
Don't Leave Money Behind
Small balances under $5,000 may be automatically distributed if you don't respond. Empower can force out balances under $1,000 as a check. Proactively roll over to avoid losing track of your retirement savings.
Your Empower 401(k) Rollover Options
When leaving your employer, you have several choices for your Empower 401(k). Each option has distinct advantages.
| Option | Pros | Cons |
|---|---|---|
| Roll to Empower IRA | Familiar platform, easy transfer | May have higher fees than alternatives |
| Roll to Fidelity/Schwab/Vanguard | Lower costs, more fund choices | New platform to learn |
| Roll to Gold IRA | Physical gold, inflation protection | Different custodian required |
| Roll to new employer 401(k) | Higher contribution limits, loan option | Limited to new plan's funds |
| Leave in Empower 401(k) | No action required | May lose access to some features |
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Step-by-Step Empower Rollover Process
Follow these steps to successfully roll over your Empower 401(k) without triggering taxes or penalties.
- 1Open an IRA at your chosen destination (if you haven't already)
- 2Log into your Empower account at empower.com
- 3Navigate to "Withdrawals" or "Distributions" section
- 4Select "Rollover to IRA" as your distribution type
- 5Choose "Direct Rollover" (trustee-to-trustee transfer)
- 6Enter your new IRA account details and custodian information
- 7Complete verification and submit your request
- 8Monitor the transfer - typically 7-10 business days
- 9Verify funds arrive and invest according to your plan
Call for Complex Situations
For large balances, outstanding loans, or company stock, call Empower at 1-800-338-4015 to speak with a representative who can guide you through the process.
Fees to Consider Before Rolling Over
Compare the total cost of ownership before deciding where to move your money.
- **Empower 401(k) fees**: Typically 0.05-0.15% admin fee plus fund expenses
- **Empower IRA fees**: May include account fees plus fund expense ratios
- **Discount brokerage IRAs**: Often $0 account fees with low-cost index funds
- **Gold IRA fees**: Annual custodian fees $75-300, plus storage fees
- **Rollover cost**: The transfer itself is typically FREE
Fee Comparison Example
On a $300,000 balance, a 0.5% fee difference equals $1,500 per year. Over 20 years, that's $30,000+ in potential lost growth. Take time to compare.
Direct vs Indirect Rollover: Critical Difference
Understanding this distinction can save you thousands in unnecessary taxes.
| Direct Rollover | Indirect Rollover |
|---|---|
| Money goes directly to new IRA | Check sent to you first |
| No tax withholding | 20% mandatory withholding |
| Simple, clean process | Must replace 20% from savings |
| No deadline pressure | Must deposit within 60 days |
| Recommended approach | Use only if direct unavailable |
The 60-Day Trap
With indirect rollover, Empower withholds 20%. You must deposit 100% of the original amount within 60 days, using your own funds to replace the withholding. Miss the deadline? It becomes taxable income plus a 10% penalty if under 59.5.
Consider Diversifying with a Gold IRA
Many Empower 401(k) participants discover their retirement savings are heavily invested in stocks and bonds. A Gold IRA rollover provides diversification that Empower's funds cannot offer - physical precious metals that have historically maintained value during economic uncertainty.
- Physical gold as a hedge against inflation and market volatility
- Gold often moves opposite to stocks (negative correlation)
- Same direct rollover process - no taxes or penalties
- Can split your rollover: part to Gold IRA, part to traditional IRA
- IRS-approved gold coins and bars stored in secure depositories
- Augusta Precious Metals offers free Gold IRA educational guides
Frequently Asked Questions
1How long does an Empower 401(k) rollover take?
Empower typically processes direct rollovers within 7-10 business days for electronic transfers. If you request a check to be mailed to your new custodian, add additional time for postal delivery. Plan for 2-3 weeks total to be safe.
2Can I roll over my Empower 401(k) while still employed?
Generally, you must leave your employer to roll over. However, if you're over 59.5, some Empower plans allow in-service rollovers. Check your Summary Plan Description or call Empower to verify your plan's rules.
3What happens to my 401(k) loan if I roll over?
Outstanding loans must typically be repaid before rolling over. If you leave employment with a loan balance, you usually have until your tax filing deadline (plus extensions) to repay. Unpaid balances are treated as distributions - taxable and potentially subject to early withdrawal penalties.
4Is there a minimum balance required to roll over from Empower?
There's no minimum balance required for a rollover. However, very small balances under $5,000 may be subject to automatic distribution rules. Empower may force out balances under $1,000 as a check if you don't respond to notifications.
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