If you have aretirement account with an employer you are no longer with, you are not alone; millions of Americans have several scattered 401(k) accounts. 

Thought it’s not necessarily a bad thing to leave old accounts alone, with a little research you may be able to do better.  Remember, small increases in return will compound nicely over time.

If you have a 401k and have retired or left your job you have a couple of options.

The first option, usually the worst, is to cash out.  In addition to having immediate taxable income from the withdrawal, you will pay penalties for the early withdrawal if you are not 59 ½.  Don’t be one of the 27 plus percent of workers caught off guard by this trap!

You can choose to not change anything.  Many 401(k) have inferior investment choices, however, some offer top tier selections that have since been closed to new investments.  If you have an investment opportunity that is not available outside of your account, consider keeping your money put. 

You may also qualify to roll your account into an Individual Retirement Account (IRA).  This choice is often made by investors who desire more control and/or flexibility with their investments. 

Before you make a decision, consider the impact of costs and fees.  Many investors do not realize that they are paying management fees in a 401(k).  If you want to know what you are paying, talk to you HR department and the plan provider to determine your total costs. 

Just as small increases in return can have significant results over time, fees, sales charges, or hidden costs will have the opposite effect. 

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