Change work? You may not know (k) account is available in your 401 to your choice for the money.

People often think that when they leave work, you must leave the money with them. This common misconception is often from financial advisers, brokers and fund companies, all of whom are often incentives to encourage you to your 401 (k) to move to a higher potential cost of issuing individual retirement account.

Fortunately, such behavior is not all financial planners. Many people committed to helping customers take full advantage of their retirement savings. Therefore, it is certain that, when access to information, your 401 (k), you get advice from a financial adviser who acts as a trustee – which means they serve the best interests of (not their own).

Ordinary Thee sconceptions can spend your money

The recent financial engine survey found that many Americans do not know that they may be able to put money in a former employer’s 401 (k) plan. In fact, 35 and 65 years of age, they have a 401 (k) between individuals who leave a job, nearly half (42%) do not know it. So, it is no surprise that many of these surveys also do not know the consequences of their decisions rollover.

That is why it is so important that you understand your options, so you can choose the most suitable for you. The following is provided to you choose when you leave your employer:

Withdrawals, spend cash

Yes, you are allowed to liquidate your 401 (k), but you should not. ” T. in fact, more respondents (34%) of one-third of the t hey did before retirement. younger baby boomers (38%) are most likely to do so, relative to the X generation (39-54 years old) 31% or more of Millennials (35-38 years old) of 36%.

Unless you are faced with a terrible situation, withdraw cash from your 401 (k) It is a bad idea, but only as a last resort should not only take the money – always available to your retirement – you owe income taxes plus a 10% IRS penalty if you are a minor 59½

Roll over the money to the IRA

Some employees to do the “Rollover”- moving money to the IRA. Many financial advisers, brokers and fund companies encourage this option, so they can earn a commission or transaction fee by assets under management. You have to answer the question wheth uh to a rollover IRA is in your best interest. And, sometimes, it is: IRA may provide your 401 (k) you do not provide investment opportunities. And through the transfer of assets to a consultant, you might get what you otherwise would not receive services. Therefore, understanding the costs and benefits, so you can make an informed decision is very important.

Transfer to the new employer’s 401 (k) plan.

Not all employers provide their employees with such a choice, but it is worth considering if not. Consolidated accounts in one place makes it easier to manage your money. If you are satisfied with your new employer’s 401 (k) plan investment choices offered this option is probably the best.

Where it is leaving.

It is often the best option is to ignore the many employees who: leave the money can be in your former employer’s 401 (k) plan. Many plans offer low costs and good investment choices, so consider this option before you act. The greatest benefit of the rest of the former employer’s plan is institutional purchasing power and high-quality planning and design accessible, many leading employers. The result could be potentially much lower costs, which in the long-term increase in the conversion of saving for retirement, and more diverse and higher quality investment options.

Although you may need the old employer, if you leave the 401 (k) to keep track of multiple accounts, and open your current job in a new, benefit is that you can have more savings.

And when you evaluate your options, you will likely find it easier to make the best choice by credible, independent financial consultant. Those financial engine of the survey, nearly 80 percent said they believe that from a financial adviser who is recommended to get the trust is very important.

Bottom line

By the time of departure to understand your retirement savings options, you can be more confident, you can achieve your financial goals.