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Husqvarna Employees

Changing jobs? What should you do with the 401(k) money you’ve accumulated? You may have up to four options (and may engage in a combination of these options).

Your 401(k) Options

If your 401(K) is still open and you still like it...<br/><br/>

If your 401(K) is still open and you still like it...

Leave it invested where it is.

Your previous employer may allow you to keep the money in your plan, an attractive option that keeps things undisturbed while allowing you to accumulate tax-deferred earnings potential. While you cannot make further contributions, you still maintain control of how the money is invested. Typically, annual distributions must begin after you reach age 73.

If you want to choose another brokerage with more investing options...&#160;<br/>

If you want to choose another brokerage with more investing options... 

Transfer to an IRA.

You can also roll all or part of your money into an Individual Retirement Account (IRA). If you do so within 60 days, you’ll avoid both penalties and withholding taxes. An IRA offers continued tax deferral for retirement, though you should check to see whether fees or commissions will be assessed.

Depending on your circumstances, the money that you accumulate in an employer’s plan may be a major source of retirement income. How you choose to manage it can have a profound impact on your retirement savings. Discussing the options with a financial professional can help maximize your savings.

If you have a new employer who offers a more ideal 401(K) plan...&#160;<br/>

If you have a new employer who offers a more ideal 401(K) plan... 

Rollover to new employers' 401(k) plan.

You can transfer the money into your new employer’s plan, which continues your tax-deferred growth potential. However, there may be rules associated with rolling over your money. Review your new plan and restrictions carefully before selecting this option. If you take money out, withdrawals will be taxed at current rates, with those made before you reach age 59 1/2 subject to a 10% additional federal tax.

If you want the money urgently and don't mind paying the penalty...&#160;<br/><br/>

If you want the money urgently and don't mind paying the penalty... 

Withdraw the money and cash it out.

You may elect to withdraw your money in cash either in a lump sum or in installments, though you’ll face tax consequences: Distributions incur a 20% federal withholding as well as standard income tax. And if you’re under age 59 1/2, you’ll pay an additional 10% federal tax. State and local taxes may also apply, which collectively could sharply reduce the amount you retain.


Rolling over your 401(k) to your new employer's plan can have advantages, such as consolidating your retirement savings, potentially accessing better investment options, and maintaining the ability to continue contributing to the account. However, you should carefully compare the investment choices and fees in both plans before making a decision.

Yes, you can have multiple 401(k) accounts from different jobs. However, it may be administratively challenging to manage multiple accounts. It's a good idea to keep track of all your retirement accounts and periodically review their performance and fees. You can also consider consolidating them through rollovers to simplify your retirement savings and investments.

Yes, there can be tax implications when you change jobs and decide to move your 401(k). If you choose to cash out your 401(k), you may face taxes and penalties. If you roll it over into an IRA or your new employer's plan, it is generally a tax-free transfer. However, it's essential to follow the rollover process correctly to avoid taxes and penalties.

The annual contribution limit for a 401(k) can vary from year to year and is subject to adjustment by the IRS. For 2023, the limit for elective employee contributions is $22,500. Additionally, individuals aged 50 and older can make catch-up contributions, which, for 2023, is an extra $7,500. The total contributions you make to your 401(k) can significantly impact your retirement savings. Maximizing your contributions allows you to take full advantage of the tax benefits and accumulate more savings for your retirement years. However, it's important to be aware of these limits and plan your contributions accordingly to avoid exceeding them and incurring penalties.

What's So Great About a Rollover?

What's So Great About a Rollover?

Making a career move requires tough decisions, not the least of which is what to do with the funds in your retirement plan.
Should You Borrow from Your 401(k)?

Should You Borrow from Your 401(k)?

Does it make sense to borrow from my 401(k) to pay off debt or to make a major purchase?
My Retirement Savings

My Retirement Savings

Estimate how long your retirement savings may last using various monthly cash flow rates.

Questions on your options? I am here to help.