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| Options When You Change Jobs: Moving On |
| If you leave your job, you probably won't be able to take your computer with you. But you can take the money you have saved in your DC plan. Before doing so, you should explore all your options. |
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Here are some of those options:
- Roll your savings into your new employer's plan–Most DC plans allow you to rollover your savings from your former employer's plan into your new employer's plan. If you decide to follow this option, make sure you speak to the benefits representative at both companies to ensure the rollover check is written out to the right entity. If the check is written directly to you, your former employer will deduct 20% for taxes. Also, you should check with your new employer to ensure you are eligible to participate in the plan as a new hire.
- Leave the money in your old employer's plan–In many cases you can leave the money in your old plan. This may make sense if the investment offerings in your old plan are better than in the new plan. It also is good option if your new employer doesn't offer a retirement plan.
- Roll the money into a rollover IRA–You also can roll over your retirement savings into an IRA. This is a good option if you can't or don't want to leave your savings in the old plan and your new employer doesn't offer a retirement plan. You can open a rollover IRA with most financial institutions and banks.
If you are considering a job change, you should first check with your current plan to make sure you are fully vested. If not, you may stand to lose a portion of your company match if you leave. Although the forfeiture of your company match shouldn't be the deciding factor in whether to take a job, it should be factored into your decision.
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