New job? Take your 401(k) provider's rollover advice with a grain of salt.
New hires are often steered toward moving their old 401(k) into an IRA at the company managing their new employer's plan, the GAO found, and are given information that is inaccurate, vague, or confusing.
When a GAO researcher posed as a job-changer seeking help with his 401(k), 12 out of 30 401(k) call center representatives raised doubts about his ability to roll money from his old 401(k) into a new plan. And inefficient or complex procedures make it much harder to roll an old 401(k) into a new one than it is to move the money into an IRA.
Your best option depends chiefly on the costs of your old and new 401(k)s. (You can keep the money from your old job where it is, usually, if you have more than $5,000 in that plan.)
Average expenses at large company 401(k)s are a hard-to-beat 0.36% of assets, investing data firm BrightScope found last year.
|Transferring funds to an IRA||Transferring funds to a 401(k)|
|Percentage of reps offering to help||33%||3%|
|Rep's typical estimate of rollover speed||"No wait"||"Weeks or months"|
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