What To Do With Your 401k Money After You Quit
Last updated on January 12, 2023 / By
When you quit your job, you have several options for what to do with your 401k money:
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1. Leave the money in your current 401k plan: If you’re happy with the investment options and fees associated with your current 401k plan, you can leave the money in the plan even after you quit your job.
2. Rollover the money into an IRA: You can roll over the money from your 401k into an individual retirement account (IRA). This will give you more control over your investment options and may have lower fees than your current 401k plan.
3. Take a cash distribution: You can choose to take a cash distribution of your 401k balance, but keep in mind that this option will likely result in taxes and penalties if you’re under age 59 1/2.
4. Leave the money with your former employer: If you’re not sure what to do with your 401k money, you can leave it with your former employer. However, be aware that your investment options may be limited and your funds may be subject to certain fees.
It is important to consider the pros and cons of each option, and consult with a financial advisor or tax professional before making a decision. Also, be aware of any deadlines for making a decision about your 401k, as some plans may require you to take action within a certain time frame.