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Subject:  Re: What happens to your 401K after you leave? Date:  4/18/1998  1:38 PM
Author:  KATinChicagoland Number:  3581 of 123001

<<What happens to your 401k if you quit your job? Does it get translated into an IRA? Or combined with the 401K program at your new job? What if your new job doesn't have a 401k?>>

If the amount is small, the employer usually will require you to take a distribution so they don't have to deal with the record keeping burden of carrying your account. If the amount is large enough you have a right to have the money remain in the old employer's 401k until your reach retirement age, if that's what you want to do.

Joe indicates that usually there is an age requirement on a rollover option. I think that's incorrect. Some companies impose this requirement but most do not, in fact I think it's pretty unusual. Most companies are happy to pay you out, and it's up to you to determine whether to roll that money to a new 401k or IRA. To determine whether your employer's plan will pay out at termination of employment, you can either ask the benefits office or read the plan's "Summary Plan Description." This is a document you should have received when you joined the plan and is supposed to be available on request.

If your new employer doesn't offer a 401k or other rollover option, you'll need to roll to an IRA to maintain the tax benefits that go with qualified retirement savings