Assuming there’s no outstanding loan, ask yourself if there’s a chance you’ll return to this employer. “If yes, leave it alone,” Parks said. “There are provisions to let you rejoin the plan, and you will get credit for time served.”
You could stay in the plan, most likely, if your account balance is above the plan’s threshold for a forced cash-out — a good idea, if you’re in a plan with low fees, investments you like and a website that is easy to use.
If your 401(k) balance is below the threshold, you may be forcibly removed from the plan, either into an individual retirement account they choose for you, or as a lump-sum payout.
Depending on your plan’s design, they can have force you out at under $1,000 or $5,000 in assets. You should be able to get instant clarification from the plan provider by logging onto your account.
For instance, under “Making a Withdrawal,” you might see a section like “Receiving a Final Distribution” with a note on termination of employment.