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Question

Asked 1/13/2008

What happens to retirement 401k if fired/?

Do i still keep it or is it cancelled or what/ Or what if i plan to leave a job after areasonable amount of years would it make sense to invest in 401k?

 
 
 
 
 
 
Answers

Answer 1/12 - Submitted 1/13/2008

You keep it, and if you begin working with another employer that has 401K, you can roll the accounts over.

 
 

Answer 2/12 - Submitted 1/13/2008

Are you talking about Superannuation or what?

 
 

Answer 3/12 - Submitted 1/13/2008

it would be cancelled.. since you were fired.

 
 

Answer 4/12 - Submitted 1/13/2008

You would keep it, as you are paying for it throughout the entire time you're working. It would still gather interest. And you probably want to invest in it, as even after leaving one job and getting another you'll still have it.

Perhaps a more tax-oriented person can give you detailed advice, but those are my thoughts.

 
 

Answer 5/12 - Submitted 1/13/2008

You will keep your contributions and accrued interest, however most companys require that you have been there a certain number of years to retain the matching funds they give you, in my case with my company it is 5 years. It is always a good deal to invest in 401k's because of it being tax derferred and lowering your tax liability.

 
 

Answer 6/12 - Submitted 1/13/2008

What ever you invested into 401k is still yours, they can not take that away from you if you quit or fired. You can do a couple options, most times you can when you get a new job transfer that 401k over to your new jobs 401k plan. That way you keep saving up for retirement, or you can request that the money all be with drawn and you cash out on it. Its best to keep saving it if you can if you have a new job already but if you dont you may need it till you get a new job for bills, rent, etc. . .Hope this helps, call your 401k they can give your further info. Goodluck!

 
 

Answer 7/12 - Submitted 1/13/2008

Usually you have 3 options, keep it in the plan, take a lump sum distribution (Tax Implications), or roll it over to another 401k at an investment firm such as Morgan Stanley, eTrade, etc...

 
 

Answer 8/12 - Submitted 1/13/2008

One company I was with asked me to transfer the money into an personal IRA and another company said I could keep it in their system as long as I wanted. Company policies on 401(k)s vary. Your contributions as well as the company's contributions in your name are not cancelled out. It is your money.

 
 

Answer 9/12 - Submitted 1/13/2008

Investing in the 401k plan is important no matter how long you are at the company. If you do end up leaving, you have a couple of options.

1. Leave the 401k where it is.
--> Not optimal because companies can be pains in the backside when trying to do things with the 401k later on.

2. Roll your old 401k into an IRA.
>Probably your best bet. Contact someone from T Rowe Price/Vanguard or another NO LOAD company and they can help you with the rollover. It's easy.

3. You can roll your old 401k into your new 401k.
-->This is nice because you don't have IRA's and old 401k's laying around everywhere. It also doesn't cost anything to roll it into your new plan.

4. You can take a lump sum of the money that you have within the 401k.
--> This is NOT advised because there are a lot of tax implications that can cost you a TON...and it also hurts you and your retirement situation later on down the road. .

No matter what you do, DO NOT let anyone talk you into rolling the 401k into an annuity of ANY kind. They are not only wrong for any tax sheltering plan, but they are also expensive, many times poor performing, and usually pushed by brokers because of the massive commissions that are paid out.

 
 

Answer 10/12 - Submitted 1/13/2008

well, it depends. If you have invested your own money into the 401k account then you have a time frame to have that account rolled over to another retirement account. If you haven't invested into it and your employer has, you will only be able to roll that account over if you have been with that company for a number of years to be fully invested. All you need to do is to contact a new retirement firm that you want to roll your account over to and sign some papers and it's changed. Or you can withdrawl the amount with an early withdrawl fee and have to pay taxes on it during tax time.

 
 

Answer 11/12 - Submitted 1/13/2008

Always invest in a 401k if it's offered. You are essentially getting free money because your company matches your deposits up to a certain percentage.
If you leave for any reason, you can always open an IRA and roll over the 401k into it.
I'm not sure if you could leave it in the 401k as it was before you left but that's not important.. you can roll it over and save it that way.

 
 

Answer 12/12 - Submitted 1/13/2008

Your contributions and their earnings are yours. Any company contributions are yours if you are vested for them. You can roll it into a new 401(k) plan if you get one or into an IRA.

 
 
 
 

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