Rollover IRA

• According to the Internal Revenue Service, you have two choices for rolling over your 401k. You can transfer it to a new employer's retirement plan or you can roll it over to your Traditional IRA. Traditional IRA and rollover IRA describe the same choice. This option allows you the most freedom, because with a Traditional IRA you can invest the money anywhere you choose.
  
  

Employer Plan Options

• You can directly transfer the 401k to your new employer's retirement plan if the plan allows it. However, your investment choices are limited to those offered by the new plan. Some 401k's allow your savings to remain in your former employer's retirement plan after you leave, but you'll still lack complete control over your investments, unlike a Traditional IRA.
  
  

Bottom Line

• You should consult with your financial adviser about transferring your 401k funds to the Traditional IRA account of your choice. Savings left in old retirement plans could revert to the state if the plan administrator loses contact with you.