Where does my money go when a 401(k) rollover reaches Vanguard?

By Kaz · Published 28 September 2026 · How this site checks figures

Summary

It lands in the settlement fund of your Vanguard IRA and sits there until you choose investments. Vanguard says, "Once we receive your assets, we'll place them in the settlement fund in your new or existing IRA, where you must then select your investments." By Vanguard's estimate, rollovers typically take 2 to 4 weeks to complete.

Before the money moves

Vanguard's first step is choosing the account that will receive it. Pretax money needs a rollover IRA or a traditional IRA, Roth money needs a Roth IRA, and a plan with both needs two separate IRAs. You can generate a letter of acceptance during Vanguard's rollover process if the old plan asks for one.

The second step is contacting whoever holds the old plan and asking for the rollover. In many cases the money is sent straight to Vanguard. One warning on the page is about eligibility: "You may not be eligible to roll over a plan account that you're still contributing to." A Vanguard IRA being open doesn't change what the old plan allows.

If a check shows up

The payee line Vanguard gives is "Vanguard FBO [your name as it appears on your Vanguard account]." Leave a check made out to Vanguard unendorsed, add your Vanguard account number, and mail it in. A check made out to you gets endorsed, marked with the account number, and mailed within 60 days.

Vanguard lists a mismatch between the name on the check and the name on your Vanguard account registration as "a common situation that can delay a rollover." Its example is a birth name on the old plan's records and a married name on the Vanguard account, so a name change since you joined the old plan is the case to look for before the check is cut.

Costs

Opening a Vanguard IRA costs $0 and Vanguard charges no processing fees for rollovers. There is a $25 annual account service fee, waived if you register for online access and choose e-delivery of documents. The IRA's custodian is Vanguard Fiduciary Trust Company.

Sources

Written by Kaz, an independent publisher.
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