The distribution-election screen a worker meets after leaving a job: a portal nav bar, a notice that employment has ended with a $50,000 vested balance, and four options. Three keep the money working tax-free — leave it in the old plan, roll it to the new employer's plan, or roll it to an IRA you control (the selected, recommended option). The fourth, cash out, is flagged in amber with its true cost: about $34,000 of the $50,000 kept (20% withheld), and roughly $271,000 of future growth forfeited. A Continue button sits at the bottom.
Meridian Retirement
DashboardMy Plan
JT
Your employment has ended — choose what to do with your account
Vested balance available: $50,000.00 · Northcastle Industries 401(k) Plan
SELECT ONE OPTION
A — Leave it in the old planNo tax · keeps growing
Stays invested exactly as it is. Fine if the old plan is good and cheap — just easy to lose track of.
B — Roll it to your new employer's planNo tax · keeps growing
A direct rollover, institution-to-institution, into your new 401(k). Consolidates your money in one place.
C — Roll it to an IRA you controlNo tax · keeps growingSELECTED
A direct rollover into an IRA you own — usually the widest choice and the lowest costs. Recommended.
D — Cash out taxed + penalized
Under 59½: a 10% penalty plus income tax, with 20% withheld before you see a cent.
You'd keep $34,000 of $50,000 (68%)
Future growth forfeited ~$271,000
Always choose a direct rollover — the money never passes through your hands.
Fictional specimen for educational use. Plan, employer, and figures are invented and refer to no real account. Investing involves risk, including possible loss of principal.
Sample — for learning. The job-change screen: three options keep a $50,000 balance growing tax-free; cashing out keeps just $34,000 and forfeits ~$271,000 of growth.