Money Girl 5 Options to Manage Your 401(k) After Leaving a Job
May 15, 2024
Explore smart strategies for managing your retirement account with an ex-employer, including options like rolling over to an IRA or transferring to a new workplace plan. Learn about the tax consequences of missing rollover deadlines and the benefits of setting up a self-employed plan.
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Participate in Retirement Plans
- Always participate in workplace retirement plans like 401ks.
- Contribute as much as possible, aiming for 10-15% of pre-tax income.
401(k) Ownership
- You own your 401(k), including vested employer contributions.
- This remains true even if you quit, are fired, or the company downsizes.
Roth vs. Traditional
- Traditional accounts defer taxes until retirement, while Roth accounts offer tax-free withdrawals.
- Prioritize Roth accounts at work if available.