What should I do with my 401(k)?
You can keep your retirement assets in your former employer’s 401(k) plan and call it done. You’ll always be able to access the money in the future. But out of sight, out of mind?
If your new employer provides a 401(k) plan, you could be allowed to roll over your previous account into the new one. Then you’ve got it all in one place.
A “rollover” is when you take money from one retirement plan or IRA (individual retirement account) and move it into another retirement plan or IRA. By rolling your retirement savings into an IRA, you continue to enjoy tax-advantaged growth potential.
If you really need it, you can take money from your 401(k). But try to avoid this move if you can. Cashing out could leave you with a lot less in retirement. You may have to pay taxes and penalties, and you'll also be losing the tax benefits that come with a retirement plan account.
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