THIS IS 50
Get Your 401(k) Rollover Right
SWITCHING JOBS and want to avoid lopping $67,000 or so off your retirement nest egg? Try this one trick: Make sure your 401(k) rollover money is being properly invested.
That might not sound like much of a trick. But not doing it is surprisingly common—and can cost you a bundle.
Here’s why: Unlike contributions to 401(k) plans, which generally default into target-date funds (TDF) that hold both stocks and bonds, money deposited in IRAs is typically parked in a cash account with a much lower yield, like a money market fund or bank sweep product. And there it stays, unless you tell the IRA provider you want another investment option.
More than 1 in 4 investors who rolled a 401(k) into a Vanguard IRA in 2022 still had their money in cash or a cash equivalent for at least a year after the transfer, according to a July 2024 report by the financial firm. A 55-year-old worker who put their IRA savings in a TDF could have nearly $67,000 more at age 65 than one who leaves it in cash, according to Andy Reed, head of investor behavior research at Vanguard and coauthor of the report.
When you leave a job, there are four things you may be able to do with money in your 401(k) account:
• Leave it in your old employer’s plan.
• Roll it into a retirement plan at your new workplace, if one is offered.
• Roll it into an IRA.
• Cash it out.
“Whichever path you choose, the most important thing is to maintain your savings and investing momentum throughout your career,” says Reed. “This way you can steadily build wealth and retirement readiness no matter how many times you change jobs.” —Paul Katzeff
MY FIRST
... VISIT TO A PLASTIC SURGEON
WHEN I SEPARATED from my husband of 28 years, I took a long, hard look in the mirror and knew what I had to do. I went to see a plastic surgeon. I was 55, had three children—all C-sections—and the only weights I lifted regularly were a hair dryer and a glass of wine.
That said, I had slimmed down so I thought I looked pretty good. Boy, was I wrong. The surgeon took a pen and went full Picasso on my body. Marked up like a butcher diagram, I felt vulnerable and inadequate. Who would want to date someone who looked like me?
When I got home, my kids set me straight. “No more body shaming!” they said. They stood me in front of that same mirror and told me to love my womanly, lived-in body. I can’t say it happened overnight, but I eventually embraced my un-flat belly and my surgery scar because they represent my greatest accomplishment: my kids.
That was four years ago. I never went back to that doctor, but I have been on plenty of dates in this lived-in body of mine, and I’ve never had one complaint. —Maria A. Brown
YOU’RE NOT TOO YOUNG TO SNAG A DEAL
YOU ALREADY know that AARP members can get a ton of discounts, regardless of age (see aarp.org/ourbenefits for the full list). But you can also find retail “senior” deals that start at age 50 or 55—if you’re willing to hunt. Here are four to look into. —Ken Budd
Walgreens
On the first Tuesday of each month, those 55+ get 20% off eligible regular-priced items.
Ross Dress for Less
Here you’ll find togs, toys—and 10% off on Tuesdays, if you’re 55+.
Michael’s
Register for a rewards account at 55+ and get 10% off your whole purchase.
Caesars
There’s a 10% discount for those 50+ at 40 participating hotels in 12 states.
MEMBER CHECK LIST
PERSONALIZE YOUR MEMBERSHIP
Set your preferences to see more of the benefits that matter most to you, browse newsletters, sign up for AARP Rewards, add a second member of your household to your membership for free and more. It’s quick and easy at aarp.org/justforme.