Taking Your Money With You

If you change jobs, your retirement plan, health insurance, and other benefits change too. There can be great reasons for moving on — including better benefits. But leaving a job just before you’ve worked there long enough to be vested may mean leaving retirement money on the table. It may pay to wait, especially if it’s only a short time.

You may decide to roll over your retirement account balance to your new employer’s plan or an individual retirement account (IRA) to keep the money tax deferred. Keeping retirement money together can be easier than trying to keep track of several plans over your working life.

One thing to avoid is taking the money out of your retirement plan when you change jobs. You’ll owe income taxes plus a 10% tax penalty — and you’ll have to start saving all over again.

The Department of Labor has a useful page Links to an external site. on your healthcare choices when you change jobs.

 

Page (11/14)