Workers generally have three choices with their 401(k) distributions:

1. Leave the money with former employer's 401(k) plan (if allowed).
2. Transfer the money to new employer's 401(k) plan (if allowed).
3. Transfer the money into a "rollover IRA" at a bank, brokerage firm, mutual fund company, or other financial institution.

An IRA rollover account generally provides the most flexibility and control. You do not have to wonder if your former employer will go out of business or be limited to a fixed selection of 401(k) plan investments. You can choose from among hundreds of investment alternatives available at a brokerage firm and ask their staff to provide investment advice. Some brokerage firms charge IRA account set-up and/or maintenance fees (e.g., $50 or $75 a year). This should be expected.

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