Well, I got the official paperwork today telling me about all the options I have for the money in my former employer’s 401(k) plan. They’ve given me plenty of options, some of which I think are not so good (i.e. taking the money out for myself), and the two that I’m mostly considering: roll over to an IRA or roll over to a new 401(k) plan. The problem with the latter option is that I don’t have a new job yet, and I don’t know if I’d even be able to roll over the 401(k) with them (it differs for different companies). So it seems that my best bet is to open a Traditional IRA and roll my 401(k) into that.
I’m going to open up an IRA with the same company that I have my Roth IRA with, and presumably buy a life-cycle/age-based/target-date fund with a target date of 2050 or so. My one concern is, even though these funds are supposedly diversified, I am thinking of investing in both IRAs in that fund…that’s not very diversified! However, there are minimums for purchasing a fund in many cases, so perhaps I’d just let my money grow using those funds (and continuing to invest in my Roth IRA), and slowly build until I have more money to spend on different funds.
At any rate, I’m thinking it’s still my plan to roll over to an IRA. I’m a bit ticked off that my old company’s 401(k) company is going to charge me a $40 processing fee, but hey, not much I can do. They charge it for pretty much every option that I would do.
As for my other transitions (since I got laid off), I’ve filed for unemployment and been informed of how much I’ll be earning each week, and of course, looking for a new job. And as I look at different job postings, I’m starting to understand what I do and don’t want to be doing. This is a pretty helpful development, since I was so overwhelmed initially thinking of all the different career paths I could follow.
I’ll keep you updated!