Dear Dr. Don,
If you opened a Roth IRA as a CD, when the CD matures, must you renew it at the institution at which it was taken out? Or can you take it out and reinvest it in another CD at another bank without being penalized or taxed when you do?
-- Raymond Retirement

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Dear Raymond,
You can move the money without triggering any penalty or income-tax impact. You just need to either effect a rollover contribution or a trustee-to-trustee transfer. IRS Publication 590, "Individual Retirement Arrangements," has more details, but I've included a couple of quotes from the publication here:

Can You Move Retirement Plan Assets?
You can transfer, tax free, assets (money or property) from other retirement programs (including traditional IRAs) to a traditional IRA. You can make the following kinds of transfers.

Transfers from one trustee to another.

Rollovers

Transfers incident to a divorce.

Time Limit for Making a Rollover Contribution
You generally must make the rollover contribution by the 60th day after the day you receive the distribution from your traditional IRA or your employer's plan.

Trustee-to-Trustee Transfer
A transfer of funds in your traditional IRA from one trustee directly to another, either at your request or at the trustee's request, is not a rollover. Because there is no distribution to you, the transfer is tax free. Because it is not a rollover, it is not affected by the 1-year waiting period required between rollovers.

The new custodian is usually quite helpful in working with you on a trustee-to-trustee transfer. You have your choice of bank, brokerage or mutual fund accounts in setting up the new IRA account.

A bank IRA account has the backstop of FDIC insurance up to $250,000 for a qualified retirement account, but the decision where to invest should be made after considering how all your assets are invested.

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