ArtsAutosBooksBusinessEducationEntertainmentFamilyFashionFoodGamesGenderHealthHolidaysHomeHubPagesPersonal FinancePetsPoliticsReligionSportsTechnologyTravel

Rollover My 401k

Updated on June 2, 2010

Why Should I Rollover my 401k?

After you’ve decided to work for another company, you may be one of those people asking: what are the practical and useful steps that I should take and why should I rollover my 401k plan? First, make sure you are aware of the 401k rollover rules and when you are changing an employer, you have four options to look at:

1. First, you can cash out all the funds you’ve contributed. But, it’s not as exciting as it sounds, because you will have to pay taxes and ten percent penalty fee, that’s why this option is not the wisest decision to make. The fallback of cashing out your retirement savings is more detrimental than the penalties and taxes alone; undeniably, the huge financial failure comes from the many years of tax-deferred compounding of your capital – meaning the earnings of your retirement account may have provided you a wealthy retirement if you have preferred a 401 rollover instead. Make sure you are investing for retirement correctly.

2. The second option some people choose is to leave their contributed funds in their previous qualified employer sponsored 401k plan. Keep in mind that even if you are not with their company anymore, their 401k account administrators will still charge you several fees on keeping and managing your account.

Additionally, though the IRS does not impose a limit on the number of retirement plans you can have, if you want to manage your retirement savings plan directly, it is better to have them in one place. You can also take advantage of a 401k loan.

Why should I rollover my 401k?

Now, it’s time to look at the two remaining options, which will answer your query: why should I rollover my 401k?

3. You may consider carrying out a 401k rollover to your new company sponsored 401k plan. Basically, this rollover option will only become available if you already knew before leaving your current employer that your new company can offer you a 401k plan. You should only go for this option if you are truly satisfied with the rates of return of your 401k account. However, if you want to obtain more than the mediocre growth that your current 401k plan grants you, take a close look at the next option, which may be the most efficient retirement plan for you.

4. The last option that you may perform is to rollover your 401k to IRA or Individual Retirement Account. Making a 401k IRA rollover is viewed by financial experts as the best step to take for people who are concerned in saving for a comfortable retirement, because this option permits the investor’s capital to continuously incur tax deferred growth. Moreover, choosing this option will also give the investors full control over their assets and investments.

How do I rollover my 401k to IRA?

Your next question may be; how do I rollover my 401k to IRA? 

Well, the process starts by contacting your custodian or custodial company. All of your current 401k assets then will be ordered for liquidation and at the same time reported to the IRS via Form 1099-R. Once a check is issued to you, you will then be given 60 days to redeposit the funds to your new custodial company. This transaction is again reported to the IRS through IRS Form 5498. Remember, you are only authorized to make a 401k rollover once every year. 

Your 401k Account

Are you currently investing into your 401k?

See results


    0 of 8192 characters used
    Post Comment

    • profile image

      Tom Daniel 

      8 years ago

      I can help you with your 401K Rollover. Contact me at and visit us

      Thank you



    This website uses cookies

    As a user in the EEA, your approval is needed on a few things. To provide a better website experience, uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

    For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at:

    Show Details
    HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
    LoginThis is necessary to sign in to the HubPages Service.
    Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
    AkismetThis is used to detect comment spam. (Privacy Policy)
    HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
    HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
    Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
    CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
    Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the or domains, for performance and efficiency reasons. (Privacy Policy)
    Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
    Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
    Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
    Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
    Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
    VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
    PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
    Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
    MavenThis supports the Maven widget and search functionality. (Privacy Policy)
    Google AdSenseThis is an ad network. (Privacy Policy)
    Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
    Index ExchangeThis is an ad network. (Privacy Policy)
    SovrnThis is an ad network. (Privacy Policy)
    Facebook AdsThis is an ad network. (Privacy Policy)
    Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
    AppNexusThis is an ad network. (Privacy Policy)
    OpenxThis is an ad network. (Privacy Policy)
    Rubicon ProjectThis is an ad network. (Privacy Policy)
    TripleLiftThis is an ad network. (Privacy Policy)
    Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
    Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
    Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
    Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
    ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
    Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)