Everyone talks about doing a rollover of your 401K plan assets into an IRA and the wonderful advantages of that. Why do so many people do rollovers— because the receiving firm WANTS YOUR MONEY.
But there are some times when it is appropriate to just leave it with your ex-employer. Here are 4 criteria for staying in place:
- Your former employer allows you to keep your 401K plan.
- You like the variety of investment options and the performance of what you have.
- The investment options are low cost.
- There is no annual administration fee incurred for you to stay there.
For right now, it usually is in your best interests to rollover since many people don’t get the 4 benefits above. I suspect that will change in the future when employers start to get better at picking 401k plans that are good for them and their employees.
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