Comments on: Should You Cash Out Your 401(k) When Leaving a Job? http://www.moneyunder30.com/should-you-cash-out-your-401k-when-leaving-a-job Personal Finance for the Young and Ambitious Fri, 19 Mar 2010 21:32:50 +0000 http://wordpress.org/?v=2.9.2 hourly 1 By: Janet http://www.moneyunder30.com/should-you-cash-out-your-401k-when-leaving-a-job/comment-page-1#comment-4021 Janet Tue, 29 Dec 2009 06:14:30 +0000 http://www.moneyunder30.com/?p=555#comment-4021 I knew all along what I had to do, but this is just reassurance that the smart thing to do is roll over to an IRA. I am in the mist of buying a second home and thinking of getting into my 401k, however putting less of a down payment may be a better option. I am just an average Joe giving heads up to the individuals that are in the same turmoil. Be ready alert and smart about your choices and investments my friends. :) I knew all along what I had to do, but this is just reassurance that the smart thing to do is roll over to an IRA. I am in the mist of buying a second home and thinking of getting into my 401k, however putting less of a down payment may be a better option. I am just an average Joe giving heads up to the individuals that are in the same turmoil. Be ready alert and smart about your choices and investments my friends. :)

]]> By: David Nelson http://www.moneyunder30.com/should-you-cash-out-your-401k-when-leaving-a-job/comment-page-1#comment-1796 David Nelson Tue, 23 Dec 2008 04:02:35 +0000 http://www.moneyunder30.com/?p=555#comment-1796 Great basic advice! Great basic advice!

]]> By: Money Under 30 http://www.moneyunder30.com/should-you-cash-out-your-401k-when-leaving-a-job/comment-page-1#comment-1795 Money Under 30 Tue, 21 Oct 2008 14:46:33 +0000 http://www.moneyunder30.com/?p=555#comment-1795 That would really suck if you had less than $5000 and your plan forced you to cash out. That happened to me once at a part time job with a Fidelity plan, but the limit was $1000 and I had like $995 in it. Err. Actually I was just rolling over an old 401(k) to an IRA last night and I noticed that the plan (John Hancock) wouldn't let you roll an account of less than $5,000 into one of their own IRAs. That's a crappy move, too. What's even crappier is that the account lost about 40% in value since July, but that's another story :( Finally, I hope that benefits admins and HR folks out there know to counsel people not to cash out. I doubt all do. During exit interviews I've had HR people that have simply stated the options--including the penalties--as if one is no worse than the other. That's one reason that it's not THAT surprising so many people cash out. That would really suck if you had less than $5000 and your plan forced you to cash out. That happened to me once at a part time job with a Fidelity plan, but the limit was $1000 and I had like $995 in it. Err.

Actually I was just rolling over an old 401(k) to an IRA last night and I noticed that the plan (John Hancock) wouldn’t let you roll an account of less than $5,000 into one of their own IRAs. That’s a crappy move, too. What’s even crappier is that the account lost about 40% in value since July, but that’s another story :(

Finally, I hope that benefits admins and HR folks out there know to counsel people not to cash out. I doubt all do. During exit interviews I’ve had HR people that have simply stated the options–including the penalties–as if one is no worse than the other. That’s one reason that it’s not THAT surprising so many people cash out.

]]> By: twenties money http://www.moneyunder30.com/should-you-cash-out-your-401k-when-leaving-a-job/comment-page-1#comment-1794 twenties money Tue, 21 Oct 2008 13:13:49 +0000 http://www.moneyunder30.com/?p=555#comment-1794 yuck, cashing out is a horrible option. However, sometimes it is really pushed. For instance, if you have less than $5,000 in your account you may be forced to cash out. I see people cash out their account a lot and I just have to hang my head in disbelief. Individuals who cash their accounts out will not get to experience the true value of compounding interest over many years. For those of us under 30 my advice is roll it into a new plan, roll it over into an IRA, or just let it stay in the old employers plan. DO NOT cash it out unless you are being forced to do so, and even then read between the lines to make sure you absolutely have to. If you do cash it out, do yourself a favor and don't spend it. Go ahead and put it into an IRA or stocks. yuck, cashing out is a horrible option. However, sometimes it is really pushed. For instance, if you have less than $5,000 in your account you may be forced to cash out.

I see people cash out their account a lot and I just have to hang my head in disbelief. Individuals who cash their accounts out will not get to experience the true value of compounding interest over many years. For those of us under 30 my advice is roll it into a new plan, roll it over into an IRA, or just let it stay in the old employers plan. DO NOT cash it out unless you are being forced to do so, and even then read between the lines to make sure you absolutely have to. If you do cash it out, do yourself a favor and don’t spend it. Go ahead and put it into an IRA or stocks.

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