What Can I Do With An Old 401(k)?

Leaving a job is a significant life transition. Whether you planned to depart or not, there’s a myriad of things to keep track of during that time. One of the most important is what happens to your 401(k) retirement savings plan. You want to ensure the account continues to support your overall financial goals as you start the next chapter of your life.

So what do you do with it?

If you have less than a certain balance (typically under $5,000), you may not have a choice. Your plan may force distribution to you. Depending on the balance, a check may be sent to you, or you may have the funds automatically deposited into an IRA.

However, if you have more than that threshold amount in the account, you have several options:

• Leave the money where it is
• Roll the money over into your new 401(k)
• Roll the funds into an IRA
• Cash the plan out

Depending on your situation, any of these options could make sense. Let’s look at each in turn.

Leave the Money in Your Current 401(k)

Most plans will allow you to keep your money in the account until the required minimum distributions (RMDs) come into play at age 70 ½. Since this is the most passive option…