What should I do with a 401 k that is less than a $1000.00? I do not work.?

Answer 1

According to this nifty website you should roll over you money into an IRA.
http://www.bc.edu/centers/crr/facts/jtf_12.pdf
third page down first paragraph.


here's an excerpt of the conclusion
Although some problems remain, eliminating the
automatic cash-out provision for small 401(k)
balances (between $1,000 and $5,000) and placing
them into IRAs is a notable improvement. It builds
upon the successful results of the automatic
enrollment experiments that demonstrated the
power of establishing the desirable outcome as the
default. It is changes like these that will work
toward improving the retirement outlook for
today’s workers.

Hope this helps

Answer 2

It is best to move it into a Traditional IRA. Since you have less than $5,000 the plan can force you out if they want to. By taking it out you have to pay a 10% penalty if you are under 59 1/2 plus pay tax on the full amount. So if you are in the 15% tax bracket you will effectively lose 25% or $250 by taking it out.

Answer 3

I had about 700 when I left my last job, and I rolled it over into an IRA with TDAmeritrade. To start out with, I just bought a couple of solid mutual funds (it pays to do a little bit of research) and a money market. I add $25 at the beginning of every month. Its not much and its not exactly growing at warp speed, but its nice to know that its there. And I think its better than taking the tax hit, unless you really need that money.

Answer 4

If you don't need the money then leave it in the 401K or roll it over to an IRA. If you need the money then withdraw it. You need to claim it as income but if you do not work then perhaps you are retired or disabled? Don't withdraw it if you don't need the money and will suffer a penalty.

Answer 5

Roll it into an IRA. If you leave it for a while, you will be shocked at how big it can become in time. My 1989 IRA, $2000 invested, is worth more than $20,000 now.

Answer 6

You don't say your age so we can't tell you how much that 401k will be worth. But the answer is the same..roll it into an IRA and then when you do start working, roll it into that companies 401k.

Answer 7

I'm sure you will get a differing opinion, but I have always closed out my 401Ks when I left jobs and just paid the tax on it.