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Ask Dave

Changing Jobs With A 401k Question

Andy is changing jobs, and has a question about his 401k.

QUESTION: Andy is changing jobs and asks Dave what he should do with his 401k. 

ANSWER: Don’t be concerned about growing your money quickly.  You should roll your 401k into an IRA.  Don’t ever leave it at your old employer and don’t put it in your new employer’s 401k. 

Do a direct transfer rollover from your former employer’s 401k into an IRA.  It will not come directly to you and that way you will avoid any penalties or taxes.  The great thing about the IRA is the flexibility and choices you have to invest in more than 8,000 mutual funds.  In your 401k you only have the option of about 10.