Baby Boomers, the nation’s second-largest population group (after Millennials), have had an average of 12.7jobs by the time they reached age 56 making it highly likely they worked at a firm offering some kind of retirement plan. (As of March 2025, 86 percent of companies with more than 100 workers offered a retirement plan and 59 percent of companies with less than 100 employees offered a retirement plan.) Switching jobs raises the likelihood that retirement benefits might get lost in the shuffle.
This is problematic on several fronts. It complicates your financial planning efforts, creates extra paperwork, may lead to mistakes in calculating RMDs (required minimum distributions) and makes it difficult for your 401k beneficiaries to access the funds they are entitled to. Worst of all: it is very easy to either lose track of multiple accounts or to forget you even have the accounts in your name.
The information below is general in nature and intended for guidance only. Every person’s situation differs. You should consult your tax professional to evaluate your situation.
What happens to your retirement account when you leave your workplace?
Generally, if you switch jobs, your options include:
- leave the money in the existing plan
- roll it over to your new employer's plan (if eligible)
- transfer the funds to a traditional IRA or Roth IRA (if transferring to a Roth, taxes will be owed on any pre-tax funds in the account)
- withdraw the funds (a taxable event for pre-tax funds, and depending on your age, subject to a penalty)
If you have changed jobs often and chosen option #1 above repeatedly, now may be a good time to consider what to do with multiple 401k accounts. However, how can you ensure you have captured all of your retirement accounts?
- Contact your previous employers: Their HR departments should have records
- Consult your own paperwork to locate old account statements, W-2s or tax returns
- Leverage one of the free online databases created to help individuals find unclaimed property:
- The U.S. Department of Labor’s Employee Benefits Security Administration (EBSA)
- The National Registry of Unclaimed Retirement Benefits
- The National Association of Unclaimed Property Administrators site – check each state where you have lived or worked
- The S. Pension Guaranty Corp. database can help locate unclaimed traditional pensions from disbanded defined benefit plans.
What to do once you have found all of your accounts
- Consolidation is perhaps the most efficient choice:
A self- directed 401k rollover of the old 401(k) plan(s) into your current employer’s plan - However, if you do not like the investment options in the plan:
Roll over the old 401(k) account into an IRA
Important guidelines to be aware of before taking action
- The SECURE 2.0 Act stipulates that accounts at your former employer that have a balance of $7,000 or greater cannot be forced to cash out. However, you will not be able to contribute more to this account if it remains with your former employer.
- A direct custodian-to-custodian transfer of retirement plan assets is a non-taxable event.
- Should you receive the proceeds of a rollover 401(k), you generally have 60 days to rollover the total amount of money to another retirement account (either an IRA or an employer plan).
- If you roll over a traditional pre-tax 401(k) into an after-tax Roth IRA, you will incur taxes.
Consulting a professional with the knowledge and experience to guide you in making informed decisions around wealth management and retirement planning is essential. They can help you answer questions like: Who do I contact about my 401K? Connect with your SageView fiduciary financial advisor or reach out to us to get connected.