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Step 1
Gather information about your traditional IRA. You need to know account numbers, passwords and the amount you have invested. You also need contact information of the company where the funds are invested.
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Step 2
Decide if it will benefit you to reinvest your money into a Roth IRA. If you are age 70.5, you must start taking mandatory distributions each year on your traditional IRA. If you don't want to do this, reinvesting the money into a Roth IRA can keep your money invested.
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Step 3
Consider a second way reinvesting in a Roth IRA. If you are still in your 40s or 50s, but need some of the money in your traditional IRA, you want to avoid paying penalties. If you reinvest to a Roth IRA, there are certain circumstances that will allow you to withdraw your money without a penalty once it has been in the Roth IRA for at least 5 years. One of these circumstances is the purchase of a home (see Resources for more information).
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Step 4
Decide where you will reinvest the money. You may want to use one specific company, such as T. Rowe Price. Or you may want to set up a brokerage account and have access to mutual funds and stocks of multiple companies.
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Step 5
Decide if you will reinvest the money yourself or have the new company do it for you. If you do it yourself, you will be mailed a check (absent the money taken for taxes) from your traditional IRA. You then have 60 days to reinvest the money into a Roth IRA. You also might consider a direct transfer of your funds from the traditional to the Roth IRA.
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Step 6
Determine how you would like the money to be invested in your Roth IRA. You can invest in whatever the new company has to offer, including stocks, mutual funds and bonds.
