Decision Guide: What Should I Do With an Old 401(k)?
When you leave an employer, your retirement account doesn’t automatically move with you. Many people are unsure what the best next step is.
Option 1 — Leave It Where It Is
Pros
- simple
- no paperwork
Cons
- limited investment options
- harder to manage multiple accounts
Option 2 — Roll It Into Your New Employer Plan
Pros
- consolidate retirement accounts
- maintain employer plan benefits
Cons
- limited investment menu
Option 3 — Roll It Into an IRA
Pros
- more investment flexibility
- easier long-term management
Cons
- requires careful rollover process
Option 4 — Cash Out
Pros
- immediate liquidity
Cons
- taxes
- potential penalties
- loss of long-term retirement growth
Related Retirement Resources
Want help applying this to your own account? Start here.
When Professional Guidance Helps
- large retirement balances
- multiple retirement accounts
- retirement approaching