NerdWallet's Smart Money Podcast
Tax Season Scams and Identity Theft Red Flags, Plus a 401(k) and IRA Rollover Lightning Round
26 Jan 2026
Chapter 1: What is the main topic discussed in this episode?
All right, pop quiz, Sean. What is a mega backdoor Roth?
Okay, a mega backdoor Roth is a super clever way to save a ton of money for retirement, but not everyone has the option to do it.
Oh, well, I definitely want to hear more about that. So luckily, we're going to be discussing that later in this episode during our 401k and IRA rollover lightning round.
Let's get to it. Welcome to NerdWallet's Smart Money Podcast, where you send us your money questions and we answer them with the help of our genius nerds. I'm Sean Piles.
And I'm Elizabeth Ayola. Now, later in this episode, we're going to be discussing 401ks and IRA rollovers in our lightning round.
But first, it's everyone's favorite made-up holiday by the Federal Trade Commission, Identity Theft Awareness Week. This is one of my favorite topics because we are all susceptible to scams. And also, it's the beginning of the year, so we are all due for a refresher about how to stay safe in this precarious, scammy world we all live in.
That's right, Sean. It's also tax time. And don't ask me how I know, but I think scammers love tax time. So as we speak, they are scheming on how to steal our IDs, take our sensitive information, and do all the other terrible things. But Sean, I just want to be honest and say I definitely need a refresher on how to protect my information from scammers.
Because even though we give all the tips on the podcast, unfortunately, I got scammed in Christmas. No. Yes.
Oh, Elizabeth, what happened?
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Chapter 2: How can I protect my identity from tax season scams?
And I just wasn't really, you know, I was in the Christmas spirit. So I was, my guard was down essentially. So I was like, okay, let me quickly check. Cause I didn't know initially how much was on the gift card. Let me see how much I have to put towards this new you know, beanbag or sofa.
So I look on the gift card and actually I don't think I've gotten a gift card before because I was like, I think I need to activate it. So I looked for activation number and then I saw a website. So I missed the website by one letter, but I didn't know at the time. And it takes me to this website. So I enter all my gift card information, trying to see the balance and activate the gift card.
And then something told me like, is this the right website? Because it just looked like one of these kind of, I don't know, just not a very familiar website.
Did it look sketchy or old or what was weird to you about it?
First of all, I had never heard about it because it was a Visa gift card. And I'm like, shouldn't I be able to do this on the Visa website? And then second, it just literally only asked for my information. There was nothing else on there. So I thought, hmm, it gave me the balance or a balance. But I was like, hmm, let me try another one.
So I go back and I look at the website again and I enter it in and it actually takes me to something that looks like a Visa website. But I thought nothing of it.
Yeah. A little more legit.
Yes. I just thought, okay, well, great. You know, I'll, you know, spend this money later when I'm ready to start looking for an item for my reading nook. Sean. So this is Christmas day. However, two days later, I'm sitting down and I'm like, okay, let me use this gift card.
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Chapter 3: What are common tax season scam tactics to watch out for?
And I input it on a website and it's like, you don't have any money on there. And I'm like, what? It's not possible. It's not possible because I haven't used it. I log in Sean, zero dollars.
That is such a classic move of scammers is they will take something like an email address from a company or in your case, a website and have one letter or a number off. So if you're not looking super closely or if you're in the holiday spirit and your guard is down, like you said, Elizabeth, you just put in your information and then they have access to, in your case, your gift card balance.
It's so frustrating. I'm so sorry.
Thank you. I was so sad. I just took a moment. I remember just laying in bed and being like, you know, I'm going to go to sleep and try again tomorrow.
Yeah. I'm so sorry that you felt embarrassed about this too. That's a really common feeling that people have when they are scammed. Like it's your fault. When in fact, it's the scammer's fault for making a website that is designed to trick you. So please don't beat yourself up too much over that.
Thank you. And just shout out to my boyfriend who just went to the rescue and called the company. I didn't know I could get reimbursed either because I thought like it's your fault. But they are working on reimbursing me. And I did use my own advice and went to the Federal Trade Commission website to report that spammy website and report the scam. So hopefully other people don't fall prey to it.
Yeah, it is nice that the gift card company was able to reimburse you. I would say that they are partially responsible for seeing whether there are any websites that look a lot like theirs out in the space, because this must happen all the time. And I'm sure they're well aware of this website.
That's right. That's right. And, you know, I just want to put it out there as well that scams are just so common. I came across a 2025 Pew Research report and it found that 73 percent of U.S. adults have experienced some type of online scam. And that's across all age groups. So it doesn't matter how young, middle age or old you are.
And stealing credit and debit card information and charging on those cards was the most common kind of scam that people sometimes experienced. And I think it felt so defeating because I'm someone who usually triple checks a website before I input any information, you know? So I was like, how did I fall for this?
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Chapter 4: When should I consider rolling over my old 401(k) accounts?
And I was like, how are they going to exploit me feeling anxious and urgent in this moment? How are they trying to get me to slip up and give them even more of my information? So I had the push notification from my credit card company. And you think that that would be kind of legit, click on that and see. what is going on in my credit card statement or what's been charged.
But I still didn't trust that. I also didn't trust the text message they sent me in addition to the email. So I went straight to the phone number on the back of the card. That's your best source of information. Just call that directly because you want to be the one who's initiating contact with them. And so I call them. I say, hey, I just got an alert about this fraud.
I wasn't purchasing this amount of money and tickets for European concerts. And then they went through a few steps to verify my information, including at one point calling me, which I thought was a little suspect because, again, I want to be the one initiating all communication in this situation.
But that's how they were able to still verify that I am who I am, which is good that they do have these measures, I guess, although it did make me kind of nervous. And I think at this point, I'm just kind of paranoid that I'm going to slip up somehow and like give them some more information. Right.
But when all of a sudden done, I was able to resolve this within 20 minutes of the time I got that push notification. Oh, that's wonderful. That was nice just to have it done with. But I didn't do anything quote unquote wrong besides use my credit card in the way that all of us do online or maybe at a store. There's no way to really know how they got my number.
Fortunately, my credit card company was able to mail me a new card within just a couple of days and I didn't have any other fraudulent purchases. And of course, I was refunded that amount for these tickets. But it just shows that this could happen to anyone at any time and be as cautious as you can be.
It really can. And it reminds me of one of my favorite features on some of my credit cards, which is to freeze it. So even if you suspect someone has used a credit card for something fraudulent, you can freeze it so that they can't make any more transactions.
So, you know, I was thinking about this too. And I was like, what could I have done differently?
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Chapter 5: What is a mega backdoor Roth and is it worth the hassle?
What might I do differently going forward? And in this case, I might freeze my cards if I'm not actively using them. That's a good tip, Elizabeth. But I don't really see how I can change my behavior. I'm already being really careful with all of this.
And if anything, maybe I'll just monitor my statements even more regularly, although that might be difficult to do because I'm looking at my account balances like every day, pretty much. So just staying on top of it is what we have to do, basically.
That's it. And like you said, it can happen to the best of us. And it's just knowing what to do if it does happen.
Yeah, yeah. So do you plan to do anything differently after your experience, Elizabeth?
Oh my goodness. Yes. Now I'm going to be triple, quadruple, quadruple checking things before I click on anything. That's for sure. And I think the most important thing there was just pausing because I did have a little voice in my head that knew that I was kind of all over the place when I was checking. That was like, why don't you just do it later? Right? There's no rush to check it now.
You can check it later. So- I think there's so much power in a pause because if you do it when you're more attentive and your guard is up, then you're more likely to catch any things that are off in whatever it is that you're doing. Yeah.
I really like that. Something that I'm trying to focus on in my spending habits is creating more friction because online shopping is designed to be as seamless as possible and so they can get our money as easily as possible.
And if you just insert more friction, like delaying looking at a website or making sure that you do have it spelled correctly before you hit go and your address bar, that can create just a little more friction that can stop you from spending money that you don't need to spend, as we are all susceptible to doing. And also, in this case, just going to a website that's not what you think it is.
That's it. I think the second thing that comes to mind for me is updating my password. So this is something that we know is common, but how many of us actually change our passwords as frequently as we should?
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Chapter 6: How do I evaluate the performance of my retirement accounts?
Two, how can I evaluate the performance of these previous employer accounts against, say, my current 401k employer-backed provider to see who is giving me the most for my money? For example, T. Rowe Price, Vanguard, Fidelity. The listener has another question, but I say we tackle these two first. Now, Sam, the crux of the question is about a 401k rollover.
Now, it's so easy to end up with multiple when you're changing jobs, but let's start with the basics. What's a 401k rollover?
A 401k rollover is the process of taking money out of an old 401k and putting it into a 401k at your current job or into an IRA, into a new retirement account. As long as the money ends up in a tax-advantaged retirement account within 60 days, it's not treated as a taxable withdrawal.
Okay, well, let's talk about when it makes sense to consolidate many 401 accounts. What are your thoughts here, Sam?
Personally, I tend to treat 401 rollovers as part of my sort of new job checklist whenever I change jobs. I do it as soon as I'm settled into the new place. Because a new job already means filling out a lot of tax and HR paperwork, so I think you might as well fill out a form to rollover your old 401 while you're at it.
A lot of the big custodians like Vanguard or Fidelity let you do this online, but there are still a few that might require you to print out a form and fill it out in pen and, like, fax it or mail it somewhere. Regardless, it often takes a few days to process a rollover.
Doing it by mail sounds a little harrowing because you then have a big check with your entire 401k balance that you hope doesn't get lost in the mail. So I'm all about doing this online. Sam, question about why you do it this way as part of your new job checklist. Is it just so you have everything consolidated?
Like, what if you experience what our listener is debating and thinking, oh, maybe my old job actually had a better investment option? How do you think about that?
Well, the thing that kind of trumps any sort of advantage of the old 401k to me is that you generally can't contribute to a 401k from an old job that you no longer work at. And also it can get kind of annoying to just keep track of a bunch of different logins and a bunch of different accounts.
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