When you leave your job, you have several choices regarding your 401(k). These options for a 401(k) rollover are pretty much universal, meaning they apply to every 401(k) and to every job change situation. Your options are:
Cash the 401(k) Plan and Receive a Full Pay-Out
I've listed this option first because it has the most serious ramifications.
According to Get Rich Slowly founder J.D. Roth, Dave Ramsey and his influential book "The Total Money Makeover" changed his life:
"In the fall of 2004, I had over $35,000 in consumer debt. I was making a solid middle-class salary, but I lived paycheck to paycheck. My money habits were terrible. When I looked into the future, all I saw were years of toil to pay for the things I'd already purchased.
"Then a friend loaned me a copy of The Total Money Makeover, a book by some guy I'd never heard of named Dave Ramsey.
J.D. doesn't talk a lot about budgeting at Get Rich Slowly — he uses a spending plan — but I want to share a personal budget planner I've created that has helped me immensely. I'm not historically a budget person myself, but I've been using this for a while and it seems to be working quite well. I hope that some of you find it useful, too.
This budget planning spreadsheet is available in the following formats: