Ep #41: Should You Roll Over Your 401k?

Can you leave your 401(k) alone and keep it with an old company? Can you be forced into a transition, rollover, or cash-out? These are questions I get asked pretty regularly by people who are switching jobs or transitioning careers, and knowing your options when it comes to an old 401(k) is really important, so today I’ll be discussing your options in this area.

Listen in to hear the different choices you have when it comes to an old 401(k) and how these may weigh out and affect your future finances. You’ll learn the benefits of consolidating your 401(k) accounts, rolling your 401(k) into an IRA, and more.

Listen to the Full Episode about your 401k:

What You’ll Learn In Today’s Episode:

  • The reason most people think about rolling over their 401(k).
  • What options might allow you to leave your 401(k) with an old job and their provider.
  • What you might need to do in order to roll your 401(k) into a new job’s 401(k) program.
  • The tax implications of different 401(k) transition options.
  • Why you may want to roll your 401(k) into an IRA and the difference in investment options.
  • The impact and penalties of cashing out your 401(k).
  • Things to consider when making the right decision on your 401(k).

Ideas Worth Sharing:

“Most plans will accept the proceeds from one 401(k) to a new 401(k). This is a like-to-like exchange, so this is not a taxable event and you will not incur tax liability or a penalty for doing this.” – Jonathan Bednar

“One thing about a 401(k) is that there are 10-15—maybe 20—different investment options in a 401(k). You have a very limited scope of mutual funds and ETFs that you can invest in.” – Jonathan Bednar

“According to EBRI, 41% of people cash out their 401(k) when they leave an employer. That is a huge, huge, huge mistake.” – Jonathan Bednar

Resources In Today’s Episode:

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