Narrator: What should you do when you leave your job
but still have money in your former employer's 401k program?
The good news is, you have a variety of options.
One is to keep your money where it's at,
but keep in mind that you'll no longer
be able to make contributions.
If you decide you like your current investment options,
be sure to ask if leaving the money in the plan is possible
and if there any additional fees as a former employee.
A second option would be to roll your money
into your new employer's 401k plan
if that plan accepts transfers.
It's very likely your investment choices will be different
but the new options could be more diverse
and you might get access to financial planning advice.
Then again, your choices could actually be narrower.
If you consider this option,
talk with your new human resource officials
to see if rollovers are possible.
A third choice would be to move your money
into an individual retirement account
at your financial institution or an investment company.
IRAs have many more investment options
and you'll likely be able to build a relationship
with a financial advisor
who can help you regularly assess your investment strategy.
Another choice would be to cash out of your plan,
but this option could be costly.
While cashing out can give you instant money
to pay off loans or to make purchases,
you'll have to pay income taxes on that money.
And you also might have to pay an early withdrawal penalty.
These can be big hits to your funds.
No matter what you choose,
it's recommended that you talk to an expert
about the best way to transfer the money from your 401k
to something new without incurring withhold penalties
or income taxes.
Figuring out what to do with a 401k when you quit
can be confusing,
so take the time to ask questions about investment options
and any taxes or penalties you might face
when moving your money from one option to another.