- If you’re not an active employee many 401(k) plans charge higher fees which can eventually $0.00 the account
- Rolling over your balance to your new employers 401(k) plan limits your investment options
- Cashing out may cost you a 10% early withdrawal penalty, be subject to taxes and your previous employer will withhold 20%
- Many 401(k) plans prohibit loans if the account holder is no longer an employee
- You can contribute to a traditional or Roth Individual Retirement Plan (IRA) even if you participate in your employers or business retirement plan*
- Contributions may be made to established individual retirement accounts until the IRS tax filing deadline while contributions to an orphaned 401(k) are prohibited
| Product | Maximum Annual Contribution Limit |
| Traditional IRA & Roth IRA | $6,500, plus $1,000 catch-up if 50 or older (Limit is for the total contributions to all traditional or Roth IRAs) |
| Traditional 401(k) & 403(b) | $22,500, plus $7,500 catch-up if 50 or older |
| Roth 401(k) & 403(b) | $22,500, plus $7,500 catch-up if 50 or older |
| 457 | $22,500, plus $7,500 catch-up if 50 or older; potential for additional catch-up when approaching retirement |
| Thrift Savings Plan | $22,500, plus $7,500 catch-up if 50 or older |
| SEP IRA | 25% of your self-employment net earnings, up to a cap of $61,000 |
| SIMPLE IRA | $15,500, plus $3,500 catch-up if 50 or older |
*traditional IRA contributions may not be fully deductible and Roth IRA contributions may be limited by your modified adjusted gross income
