What should you do with a $500K+ 401(k) when you retire?

Compare the options before choosing a destination

Depending on your circumstances and plan rules, you may be able to keep assets in your former employer’s plan, move eligible assets to another employer plan, or roll them into an IRA. Taking a cash distribution has a different set of tax consequences. An IRA rollover is one possibility, not a required retirement step.

Ask your plan administrator for the current investment menu, fee information and distribution rules. A clear comparison starts with the actual terms of each account, rather than a general claim that one account type is always better.

Look beyond the number of investment choices

Consider total costs, available services, withdrawal flexibility and the investment options you would actually use. Account protections and special treatment of particular assets may differ. Employer stock, outstanding plan loans and after-tax money deserve specific questions before a transfer.

Keep investment selection separate from account selection: an IRA is an account, not an investment strategy. Moving the account alone does not establish an income plan.

Coordinate the decision with the rest of your retirement

Think about how this account fits alongside Social Security, any pension, cash reserves and other investments. Before initiating a rollover, discuss eligibility, transfer mechanics and tax implications with your plan administrator and an appropriately qualified professional.