Who This Applies To
You currently have an Individual 401(k) account at Charles Schwab using Schwab’s plan document and account package. Your existing account is typically a Traditional (pre‑tax) Individual 401(k).
If you plan to make Roth employee deferrals, Schwab requires that you open a separate Roth Individual 401(k) account.
Important Notes Up Front
- You are using Charles Schwab’s Individual 401(k) plan design, not a third‑party plan document.
- Schwab requires separate accounts for Traditional and Roth assets.
- Questions about forms, processing, or account setup can be directed to Charles Schwab.
Steps to Add a Roth Individual 401(k) Account
Step 1: Complete the Schwab Individual 401(k) Account Application – You must submit the full Individual 401(k) Account Application (approximately 10 pages). – Even though you already completed this form when opening your Traditional 401(k), Schwab requires a new application to add the Roth account.
Step 2: Complete Section 1 Carefully (Most Important Step) In Section 1 – Plan Information, make sure the following selections are made:
- Select account type:
- ☑ Roth Individual 401(k) (Roth contribution only)
- Are you adding an account to an existing Schwab 401(k) Plan?
- ☑ Yes
- Provide the account number of your existing Traditional Individual 401(k)
These selections ensure Schwab correctly links the new Roth account to your existing plan rather than treating it as a brand‑new plan.
Step 3: Complete the Remaining Sections of the Application – Fill out all remaining sections as requested, even if the information mirrors your existing account. – Schwab generally requires the application to be completed in full for processing.
Step 4: Submit the Application to Charles Schwab – Submit the completed application according to Schwab’s instructions (online upload, secure message, or as otherwise directed by Schwab).
After the Roth Account Is Open
Once the Roth Individual 401(k) account is established:
- Confirm the Roth account number with Schwab
- Notify your payroll provider or payroll contact that Roth deferrals should be directed to the new Roth 401(k) account
- Ensure payroll clearly distinguishes between:
- Traditional (pre‑tax) deferrals
- Roth deferrals
Need Help?
Because this account uses Charles Schwab’s Individual 401(k) plan and forms, Schwab is the best resource for: – Application questions – Processing timelines – Account setup confirmation
If you would like help understanding how Roth deferrals fit into your overall contribution strategy, or whether Roth deferrals are required or optional for you, please reach out to our team.
This flyer summarizes Schwab’s current process for adding a Roth Individual 401(k) account. Schwab requirements and forms are subject to change.
