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Key Takeaways
- Many workers change jobs roughly a dozen times over their careers, which is how retirement savings can end up scattered across old 401(k)s.
- Forgotten 401(k) accounts now hold more than $2 trillion nationwide.
- Free tools like the Department of Labor's Retirement Savings Lost and Found database and PBGC's unclaimed benefits search can help you track down old accounts at no cost.
- Once you find an old 401(k), you generally have four options: leave it in place, move it to a new employer's plan, roll it into an IRA, or cash it out.
- Rolling eligible old 401(k)s into a single IRA can make your savings easier to see and manage, though it's worth comparing fees, investment options, and other factors before you decide.
If you've worked more than a couple of jobs, there's a good chance you've left more than one 401(k) behind. It happens quietly. A new job starts, health insurance and payroll paperwork take priority, and the old account just stays where it is. Multiply that by every job change over a career, and it's easy to lose track of how much you've actually saved for retirement.
You May Have More Retirement Savings Than You Realize
Changing jobs is normal, and so is leaving a 401(k) behind when you go. Many workers change jobs roughly a dozen times over their careers, and each job change is a natural point where an account can get left behind. Nationally, that adds up fast. Forgotten 401(k) accounts across the US now total more than $2 trillion in assets.
Think about your own career for a second. Maybe there's a few thousand dollars in a 401(k) from a job you left years ago, a bit more sitting in a plan from another former employer, whatever's building up in your current plan, and a few thousand more in an IRA on the side. Spread across accounts like these, it's hard to see your full retirement picture. Bringing them together is what shows you exactly where you stand.
How to Find an Old 401(k) From a Previous Job
Before you can decide what to do with an old 401(k), you need to know it exists and where it's held. A few practical starting points:
- Check old statements or emails from former employers, even ones tucked away in a filing cabinet or an old inbox.
- Contact your former employer's HR department, or the plan administrator listed on your last statement.
- Search the Department of Labor's Retirement Savings Lost and Found database, a free government tool built to help savers track down old employer-sponsored plans.
- Search the PBGC's unclaimed benefits database, where all it takes to check is your last name and the last four digits of your Social Security number.
- Check the National Registry of Unclaimed Retirement Benefits, a privately run database many former employers use to report unclaimed accounts.
- If your former employer no longer exists, search your state's unclaimed property database, since retirement funds are sometimes transferred there after enough time passes.
Not every search turns something up on the first try, and that's normal. Between a couple of former employer calls and a few free database searches, most people can piece together a fairly complete picture of what they've left behind.
What Are Your Options for an Old 401(k)?
Once you change jobs, you generally have four options:
Cashing out tends to be the option that looks simplest, but it's usually the most expensive. It typically triggers taxes and early withdrawal penalties. If you're under 59½, that usually adds an extra 10% tax on top of what you'd otherwise owe.
Why Consider Rolling an Old 401(k) Into an IRA?
Rolling an old 401(k) into an IRA is one option worth a closer look, so here's what it can offer.
- One place to manage your retirement savings: Instead of juggling logins and statements from every former employer, an IRA gives you a single account for eligible rollovers, all in one place.
- A clearer view of your savings: Consolidating old 401(k)s can make it simpler to see how much you've actually accumulated and factor that balance into your broader retirement planning, rather than estimating from memory.
- Keep your retirement savings with you: Your retirement savings don't have to stay tied to every employer you've ever worked for. An IRA gives you an account that belongs to you, separate from any one employer.
- Investment choices: Depending on the IRA provider you choose, you may have access to different investment options than those available in your former employer's plan.
- Potentially easier account management: Instead of remembering multiple providers, logins, and balances, consolidating into one IRA can help simplify the day-to-day work of managing your retirement savings.
