Upticks: 401(k) Rollovers, Private Equity, and Roth Conversions
By Luke Sullivan on August 13, 2026
Many financial decisions are presented as simple rules: roll over your old 401(k), gain access to more investment options, or convert pre-tax retirement money to Roth while tax rates remain favorable. Each recommendation may sound reasonable, but none should be treated as an automatic answer.
In this week’s episode of Upticks, Jake and Cory discuss three decisions that require more context: what to do with a 401(k) after leaving an employer, whether private equity belongs in workplace retirement plans, and when a Roth conversion may make sense. Although the topics are different, the underlying principle is consistent. A financial decision should support the complete plan rather than follow a general rule.
Editor’s Note: The YouTube video above features a shortened segment from this week’s discussion about what to do with a 401(k) after leaving an employer. To hear the complete conversation—including Jake and Cory’s thoughts on private equity in workplace retirement plans and when Roth conversions may deserve consideration—listen to the full episode using the podcast player above. Enjoy!
What should happen to an old 401(k)?
Leaving an employer creates several possible paths for a workplace retirement account. Depending on the plan and the individual’s circumstances, the money may remain in the former employer’s plan, move into a new employer’s plan, roll into an IRA, or be divided between more than one destination.
The first question should not be, “Where should the account go?” It should be, “What does the financial plan require?”
Someone changing jobs may prioritize consolidation, investment options, fees, or simplicity. Someone retiring may also need to consider income distributions, tax withholding, liquidity, and how the portfolio should change as it moves from accumulation to utilization.
Age can also matter. Under the separation-from-service exception commonly called the Rule of 55, distributions from a qualified employer plan may avoid the 10% additional early-distribution tax when an employee separates from that employer during or after the calendar year in which the employee turns 55. That exception generally applies to the employer plan—not an IRA—so an immediate rollover can remove an option that may be useful before age 59½. Plan provisions and individual tax circumstances still need to be reviewed.
The investment strategy deserves equal attention. A portfolio designed for decades of regular contributions may not be appropriate once the account needs to help support retirement spending. The transition can introduce sequence-of-returns risk, changing cash-flow needs, and a shorter period in which to recover from an unfavorable market.
Jake and Cory also question the assumption that dividing assets between two similar advisors automatically creates diversification. Diversification generally comes from the investments and risks inside the portfolio, not simply from using multiple professionals. Two uncoordinated strategies may create overlap, conflicting recommendations, or an overall allocation that neither advisor fully understands.
Does greater investment access always help?
The second discussion focuses on private equity and private credit inside workplace retirement plans. Jake and Cory are skeptical of presenting these investments as an automatic improvement simply because they have historically been less accessible to everyday investors.
Private investments can introduce higher fees, limited liquidity, less frequent valuation, greater complexity, and additional manager-selection risk. Those characteristics do not necessarily make private equity inappropriate, but they do make the decision more complicated than adding another fund to a menu.
Department of Labor guidance has addressed private equity as a component of certain professionally managed, diversified asset-allocation funds—not as a standalone option that participants select directly. That guidance emphasizes fiduciary evaluation of fees, liquidity, valuation, complexity, manager capability, and the interests of plan participants.
The broader lesson is that access is not the same as suitability. An investment may be available without being necessary for a particular retirement plan. Before adding complexity, investors and plan fiduciaries should understand what role the investment is intended to serve, what risks it introduces, and whether those risks are reasonably compensated.
When does a Roth conversion deserve consideration?
Roth conversions are another area where broad recommendations can create unnecessary pressure. A conversion moves eligible pre-tax retirement assets into a Roth account and generally causes the pre-tax amount converted to be included in taxable income for that year.
Whether that trade-off is worthwhile depends on several factors. These may include projected required minimum distributions, the ability to pay the conversion tax from assets outside the retirement account, the expected time horizon, current and anticipated tax brackets, estate-planning goals, and how much flexibility already exists across different account types.
Traditional retirement accounts generally become subject to required minimum distributions, while an original Roth IRA owner is not required to take lifetime distributions from the Roth IRA. That difference can make conversions useful in some plans, but it does not make them universally appropriate.
Jake and Cory ultimately favor tax diversification over an all-or-nothing approach. Holding a combination of pre-tax, Roth, and taxable assets may provide more flexibility when deciding where retirement income should come from in a particular year. The ideal balance will vary, and it should be revisited as tax laws, account values, income needs, and goals change.
Put every decision in context
A 401(k) rollover, access to private investments, and a Roth conversion can each be useful in the right circumstances. The mistake is treating any one of them as an automatic next step.
Retirement planning requires evaluating the benefits that may be gained, the options that may be lost, the costs involved, and the way each decision affects the rest of the plan. The most appropriate answer is rarely determined by the account alone. It is determined by what the account needs to accomplish.
Watch the shortened YouTube discussion above or listen to the full episode using the podcast player to hear Jake and Cory explore all three decisions.
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