So, what happens to your 401(k) when you quit or get fired? The good news is the hard-earned money that you contributed is safe. However, there are some instances where you may have to forfeit some of the money your employer contributed.
However, there are some important details you need to be aware of to make the smartest money decisions for your retirement savings when leaving a job. Some strategies can save you significant money, so let’s explore your options and make the wisest decisions.
Leaving a job can be very stressful, but you don’t need to be worried about losing your retirement savings. Any money you contributed to your 401(k) plan is protected and cannot be taken away by your employer, even if you left on poor terms.
Vesting determines the proportion of your employer’s contributions you’ll get to keep in your 401(k) after you leave your job. It doesn’t apply to any of the funds you have contributed yourself to your account.