Can: Roll it Over to Another Retirement Plan

If you’re still working and you change employers, don’t leave your 401(k) plan behind! Actually, in many cases, employers don’t let former employees maintain their accounts with them, and unfortunately, you’ll be forced to take it with you.

The great news is that 401(k) plans ARE portable. This means you can roll them over into another retirement plan you have. If your new job has a 401(k) plan, you can roll your former plan into your new one with no consequences to your taxes.

If your new employer doesn’t include a retirement plan, you can open up an IRA and roll your 401(k) program into that. Remember that if you roll over your 401(k) plan into an after-tax account, like a Roth IRA, you’ll owe ordinary income tax on the entire amount you convert.

You should consult a tax advisor on this subject if you plan on going with this route.