What to do with that old 401k: Your new job checklist

Nicole Sara Sivens
September 6, 2018
8 min read
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For many of us, switching jobs is the new normal. Whether you’re moving on to elevate your career or off to start your own business, you’re not alone. Data from the Bureau of Labor Statistics shows that employees are only staying on board for fewer than 5 years, with millennials sticking around an even shorter time than that.  

When you’ve decided to take the leap, there are a few things you need to tidy up before moving on.

New Job Checklist

Health insurance

Figure out if you’ll be covered by COBRA or electing to cover yourself through the ACA. COBRA coverage is extended to you by your employer and they’ll follow up with the details after you part ways. The ACA (aka Obamacare) is an online tool to shop for health insurance coverage.


Your flexible spending account and health savings account might be a “use it or lose it” situation, so figure out if you need to cash out or spend your balances.

401k rollover

The biggest one on that list? Your retirement investments. Let’s say that you’re the most average person in the US. You earn $50,000 each year and sock 6% away in your 401k, you start working at 22, retire at 65, and work 10-ish jobs during that time.  

By the end of your careers, you could have 10 401k accounts each with around $13,000 of your contributions plus a couple hundred grand in growth. The average 401k plan charges 1% per year in fees, which doesn’t sound like much. But! Don’t forget about compound interest because it goes both ways and can take a lot of your money. Your oldest 401k with $13,000 in it could have its value reduced by ⅓ when you’re ready to retire.

That’s right – that little 1% fee could eat up $65,000 of your future retirement dollars. And that’s just for the one account.

By leaving your old retirement accounts stranded in the financial ether, you could be shelling out more than a half-million dollars in fees alone.  

But it’s not just about the money. When you were with your previous employers, you were beholden to the funds that were chosen for your retirement investments by their plan administrator. The five major fund families that control 75 percent of all employer-sponsored retirement plans — valued at $5.6 trillion — don’t offer any socially-responsible diversified mutual funds that are free of the 200 largest fossil fuel companies. 

In other words: Chances are that all your old accounts are invested in oil.
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