Have a 401K Plan at a Former Employer?

You may have had multiple jobs over your career, and left behind retirement account balances — critical building blocks for your retirement. Here’s a short guide to your options of what to do with a retirement account left with a former employer:

Roll it over to an IRA
• A rollover IRA allows you to continue any tax-deferred growth.
• A direct rollover IRA helps you avoid current taxes and early withdrawal penalties.
• You retain flexibility to select investments that fit your specific needs.
• A rollover IRA allows you to consolidate your retirement assets in one convenient place when you change jobs or
decide to retire.

Leave it in your plan
• Leaving your account in your former plan lets you continue any tax-deferred growth.
• As long as you don’t take money out before age 59½, you avoid federal income taxes and a 10% early withdrawal penalty.
• You always have the option to move your savings to another retirement plan later.
• You have continued access to your plan and its investment options, which may be perfectly suitable for your needs.
• You may be protected from creditors.
• You may benefit from lower fees than you would pay in other options.

Transfer it to your current qualifid plan (401k, 403b)
• Transferring your account to your current plan lets you avoid current taxes, early withdrawal penalties, and continues any
tax-deferred growth.
• Depending on your plan, you may be able to consolidate other retirement assets in one account.
• Your current plan may allow you to borrow from your account (although this generally is not recommended).
• You may be protected from creditors.
• You may benefit from lower fees than you would pay in other options.

You also have the option to take a withdrawal from your qualified plan account. Taking money now means you will have money right now, but it could come at a price of an early withdrawal penalty and taxes due. Have more questions? Consult your benefits administrator or advisor for guidance on the option that’s most appropriate for your individual circumstances