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Given it’s likely you’ll change your career at least once, be proactive and know what to do with your 401k. We'll guide you through what you need to know and do.
Before you quit your job: we’ll help walk you through your options based on your specific goals and possibilities:
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First, we’ll help you find out what your company will allow you to do with your 403(b)/401(k).
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If you owe a 401k loan, it becomes due and payable upon termination. Investing your money wisely before you quit may help pay off that loan faster than a savings account at the bank.
- You may be able to leave your 403(b)/401(k) where it is; we’ll help you decide if this is to your financial advantage.
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You may receive cash; if so, we’ll help you invest it wisely. We’ll discuss your goals, financial future wish list, and explain your options.
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You may be able to roll it over to your new employer’s plan; we’ll help you
decide if that is a good option.
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You can roll it over to an IRA; we’ll help you do that without triggering income taxes.
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Retirement presents different possibilities. We’ll walk you through your options like maxing out 403(b)/401(k) contributions before you leave. We’ll help you understand the differences between a cash balance lump sum or an annuity. If you are getting a lump sum, we’ll help you consider whether to roll it over to an IRA & discuss pros and cons of paying taxes or penalties if you cash out.
If your current employer requires you to roll over a retirement asset, we’ll help you understand the rules and options.
If you are married, we’ll help you choose the survivor benefit option.
If you have choices with medial benefits, we can help.
We’ll give you sound advice regarding living expenses while waiting for retirement benefits to begin.
If your income the following year will be substantially less, we’ll advise you on moving deductions or income from one year to another.
If you have stocks, bonds, funds, rental real estate, etc. to sell that will generate capital gains, we'll help you make the most of your investments.
Collect this before you leave:
- pension plan description
- stock options, ownership plans
- summary of medical benefits
- 403(b)/401(k) plans
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Other Issues:
We’ll help you think through other important areas before you quit or retire.
For example, if you have stock options, what are the rules before leaving? We’ll make a plan.
We'll advise you on making financial moves now while you have a job, such as refinancing your home.
We'll help you consider using any leaves now that you may have to forfeit once you quit or retire.
We’ll recommend that you check the company's internal website for information you may need later that you won't have access to once you are gone. You'll print or copy important documents while following company policy.
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Before you Quit a Job:
Review, update and re-write your resume every year. This allows you to quickly respond to opportunities as they present themselves. Create several resumes for a variety of career directions that can be posted in an online database for easy retrieval and sending.
Compile a list of email addresses and phone numbers of people you might want to keep in touch with. Draft a departure letter at home / not on company property.
You need good references to land another good job. Get work/cell/home numbers before you leave.
Leverage the power of Facebook and social networking to connect with other professionals in your field. Update your LinkedIn account with recent accomplishments and expand your professional network.
Advise headhunters of your pending intentions to get the ball rolling.
Draft a resignation letter. Even if you are just issuing an oral resignation, you should think about what you are going to say. If your boss asks why you are leaving, what will you say? Take the high road. Be gracious and dignified. Make the transition seamless for your current employer. Clean up messes, offer to train your replacement, be available for questions after your departure and thank your current employer for the experience. Leaving on a positive note will only enhance your future career options.
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Start investing: Have 4-6 months of expenses on hand; investing your money now can make you money faster than a traditional savings account.
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Changing Jobs or Retiring : Things to Know
