When you change jobs, there can be a lot of excitement and uncertainty. It’s no wonder that people forget about their 401k accounts. 

There is also the mistaken assumption that your 401k needs to stay with your former employer or that if it’s doing well, you should just leave it alone. Don’t do it! You have moved on, and your money should too. Here’s some compelling reasons to move your old 401k account:

Control - You can move your old 401k account into an IRA at any institution you choose. Already have a Roth IRA or a brokerage account opened at a financial institution you like? Add your 401k rollover and you will have a dashboard view of your whole investment portfolio.

Choice - 401k investment choices at any employer are very limited. If you rollover your account to an IRA, you can pick from over 9,000 mutual funds, as well as ETFs and stocks.

Growth - You can’t contribute to a 401k at a former employer but, if you roll it into an IRA, you can add up to $6,000 a year ($7,000 if you are 50 or older) to continue to build wealth. The rollover dollars do not count towards your current year contribution, so don’t forget to add that $6,000 each and every year.

Fees - Most 401k administrators charge some kind of annual fee to maintain open accounts. You don’t need to pay this. Rollover your account to avoid fees and get control over your account.

If your new employer has a 401k plan, you do have the option to rollover your old 401k to your new 401k, but you will still have limited investment choices and lack of control over where the account is located. Expand your investing strategy by contributing to your new 401k as well as adding to the rollover IRA you just started.

How to Complete a Rollover

Once you decide you want to do a rollover, you need to choose where to open your new account. If you have existing accounts at a financial institution you like, move your money there. If you are new to the rollover game, Smart Sister Finance suggests choosing a large financial institution that will have lots of investment choices and no account or trading fees. Check out Fidelity, Charles Schwab, Vanguard and TD Ameritrade for a start (NOTE: Smart Sister Finance is not affiliated with any of these companies and does not receive compensation for recommending them).

Depending on where your old 401k is, you can either have your new financial institution contact the 401k administrator to initiate the rollover, or you may have to open the rollover account and give that new account number to the administrator for your old 401k. Yes, it seems like a lot, but it is usually a painless online process. Keep repeating to yourself “I’m going to get my money… I’m going to get my money” and, in a couple of steps, you will have it!

In the rare circumstance that your old 401k plan mails you a check to deposit into the rollover account, just make sure you complete the process within 60 days.

When you make a career move, you have a lot on your mind but, don’t forget your 401k. Completing a rollover gives you control over the retirement dollars and employer match that you have accumulated and better investment options. Why be tied to the financial administration and investment choices provided by a company you don’t work for anymore? Grow your wealth while you grow your career and you will buy yourself life choices.

Need help completing a rollover or learning about investments?