Personally, the option to roll over a 401k to a Roth IRA is pretty appealing.

This link allows you to compare between historical returns of a 401K plan and an IRA.

http://www.myplaniq.com/LTISystem/f401k_planrollover.action?from=Apple%20401K&to=Schwab%20OneSource%20Select%20List%20Funds

This is a comparison between Apple 401K and Schwab Select

Often, IRAs have more choices of funds in more asset classes that can give you higher returns.

Note that we have no relationship with Apple or Schwab and you can pick the IRA broker of your choice. We have around 2000 401K plans but not all — if you give us tickers, we can plug in your company’s plan and you can do the comparison.

It’s in everyone’s best interest to keep on top of their beneficiary designations.

However I’m assuming the fees would be high (especially if you don’t otherwise have a company set up). You would have to decide if the higher fee level and paperwork vs. IRA is warranted by the ERISA protections of 401k (that IRAs don’t have).

Also you never mentioned that age plays a huge part in any distribution decision and how it is subsequently taxed.

I usually advise my clients to roll it over to an IRA as soon as possible. It just gives you more control and flexibility and 99 times out of 100 the expenses are lower since there isn’t that third party taking their cut for administering the retirement plan.

Here is Australia it’s pretty much locked until retirement age (65). Unless you are terminally ill or worse you cannot access your superannuation. I previously worked for the Fed Govt and a downside to that is that they do not allow the transfer of my account to my new one. I also am not allowed to add to it. This means at age 29 I have $50k locked in the Govt account! I would have preferred to roll it over into my new account but it is trapped there to ‘protect’ us. Now at 32 I’ve had to start again only just now getting it up to $20k with a separate provider.

If you don’t know how to tell if your 401(k) is better than average, just assume it’s not and roll over into an IRA as soon as possible.

I have one old 401(k) at a previous, large employer with a good plan (better than what I can get on my own). All my other 401(k)s I have rolled over into one rollover IRA. I keep it separate from my other IRA assets just in case I ever have another good plan, but I’m not holding my breath.

To those rolling over into an HSA – not only are you using up your HSA contribution for the year, but you are not getting social security and medicare taxes deducted for the contribution.

@Jan – the choices are pretty much the same for 403(b)’s as they are for 401(k)’s. Leave it there, cash it out, roll it over to new employer’s plan or roll it over to IRA. The last choice is still the best.

IRA’s are protected from bankruptcy at the federal level. The 2005 bankruptcy reform law explicitly extended coverage to 403b and IRA for $1M and any monies rolled over from a ERISA fund. The Supreme Court also ruled that IRAs are protected from bankruptcy.

You can borrow from a 401(k) but not an IRA;
401(k)s are protected from bankruptcy but IRAs may not be (state law applies to IRAs)

Generic advice: roll to new 401(k) if you are happy with the choices and fees.

J.D. is probably a lot faster at sorting through the slew of spam!

I rolled the old 401k and the rollover IRA into the new 401k, and the Roth IRA into the HSA. From five accounts to two. There was a maximum I was allowed to move from the Roth IRA to the HSA, but the amount left over in the Roth IRA was less than the amount I had contributed, so I was able to cash that out without penalty. And used it to pay off a credit card.

Plus this way you can ensure that your account beneficiaries are up to date. What if your old 401k beneficiary was your former spouse-and you no longer wish them to inherit upon your death?

My 401k is invested in:
Spartan 500 Index – Investor Class (FUSEX)
Oppenheimer Developing Markets Fund Class Y (ODVYX)
Spartan International Index Fund – Investor Class (FSIIX)

There are about 30 available investments, including the domestic and international index funds above. Do I just have a really good 401k, or am I naively missing out on something else? Ours is through Fidelity, so I’d figure a lot of other people would have similar plans, I’m sure there are lots of Fidelity 401ks out there.

Check your options before moving money from the TSP account. I read that those funds are some of the best managed and wish I left my money there after leaving work with the feds.

Don’t roll it over to a new employer’s 401k. Most 401k plans are very restricted in their investment choices.