What to Do with Your Old 403(b)

Recent studies have found that one in three 401(k) investors has cashed out of his or her plan before reaching age 59½, often when changing jobs.

It’s a tempting move to make, but even if your account balance seems too small to represent significant retirement savings, the power of compounding over time can be your best friend.

That’s why the many benefits of your UC Retirement Savings Program include the ability to roll in your other retirement accounts.

It’s an especially attractive option if you are new to UC, because you may have a previous employer’s account that you need to make a decision about.

WHAT ARE THE BENEFITS?

Besides the obvious perks like simplicity, convenience, and continued tax advantages, you get these benefits, too:

  • Simplicity and convenience. Your money still has the potential to grow tax deferred, as it did in your old plan, but it’s easier to manage when it’s all under one roof.
  • Lower fees and flexibility of investment choices. You can choose from a variety of investment options, including those from the UCRSP Fund Menu, which carry lower expenses than many similar publicly traded investment options.
  • Better control. If you have investments in several locations, it’s difficult to stay in control of your overall portfolio. When everything is in one place, it’s easier to see your complete financial picture. 
  • Personal help with your rollover and more. You can get personal retirement planning assistance from a Retirement Planner. This service is available at no additional cost.

NEXT STEPS

Before you make a decision, you may want to take these steps:

  • Compare the fees and expenses. Understand the fees charged by your old plan and IRA provider and compare them to the UC Retirement Savings Program fees. 
  • Know your preferences for managing your accounts. For example, you may like having your assets with one provider.
  • Evaluate the potential tax impact of any move. Make sure you understand how your taxes may be affected by the choice you make. 
  • Get help from a Retirement Planner. Fidelity Retirement Planners can help you evaluate your decision based on your complete financial picture.

THE BOTTOM LINE

Employer-sponsored plans like those offered by UC are among the easiest, most recommended ways to plan and invest for your retirement.

When you take full advantage of your UC Retirement Savings Program, you’re building a foundation for your future. And that may just be the best move of all.

 

Keep in mind that investing involves risk. The value of your investment will fluctuate over time and you may gain or lose money.

1 “Beware of cashing out your 401(k)," Fidelity Viewpoints, May 31, 2016.

Fidelity Brokerage Services LLC, member NYSE, SIPC, 900 Salem Street, Smithfield, RI 02917
© 2017 FMR LLC. All rights reserved.
751982.7.0

Take action

Get the Facts

Bringing retirement assets together in one place can simplify your finances and become part of a sound financial strategy. Our fact sheet can help you understand your options for your non-UC retirement accounts.