This page compares rolling an old 401(k) into an IRA versus leaving it in the employer plan side by side. Neither option is right for everyone; the better choice depends on taxes, timing and what you need the money to do.
Side by side
The table sums up the main differences.
| Roll over to an IRA | Leave it in the 401(k) | |
|---|---|---|
| Investment choices | Almost any fund or security | The plan’s menu |
| Costs | Depend on what you choose | Can be very low in large plans |
| Penalty-free access at 55 | No (59½ rule applies) | Yes, if you left the employer in or after the year you turned 55 |
| Creditor protection | Strong, but varies by state | Strong federal protection |
| Simplicity | Several old plans in one place | One more account to track |
How to decide
Start with your tax bracket now and later, how much flexibility you need and who else depends on the money. First Command Financial Services can run both options with your numbers.
This article is general financial information only, not investment advice tailored to your circumstances. Investing involves risk, including loss of principal. Before making any financial decision, consult a qualified professional about your specific situation.