Survey: Job-hoppers favor the 'rollover IRA' option
Job-changers who want to keep their retirement savings sheltered when they change companies often favor IRAs, according to a new survey by American Century Investments, a mutual-fund, brokerage and investment-services company in Kansas City, Mo.Skip to next paragraph
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The survey asked 750 adults with retirement savings what they would do with their 401(k) money if they changed jobs, and 43 percent replied they would roll the money over into an individual retirement account.
Thirty-four percent would move their retirement money into the new employer's plan or leave it in the former employer's plan. And 10 percent didn't know what they would do.
"The rollover IRA often is the smartest choice for somebody leaving a company because it has features that most workers just couldn't get if they leave the money in place or move it to the new employer's plan, which many times isn't allowed," says Tony Vannicola, service marketing manager of the IRA Personalized Rollover Service for American Century.
A typical 401(k) plan might have six to 10 mutual-fund options, but a rollover IRA often offers many more investment choices - thousands with a brokerage rollover IRA - from mutual funds to stocks and bonds and others, Mr. Vannicola added.
The research consisted of nationwide telephone interviews of people who are 18 years of age or older, currently saving or investing specifically for retirement.
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