The average American changes jobs 12 times in his or her lifetime. With each new job comes new offices, new co-workers — and possibly a decision about what to do with the 401(k) plan they started at their last job. 

 Selecting the right course of action for what becomes of that money can be crucial because the 401(k) has essentially replaced pensions as an employer-sponsored retirement-savings vehicle.

 You have to look at where you are in life. If you’re in your 40s with many working years left, it might be better to roll the 401(k) into your new company’s plan. If you’re just a few years from your planned retirement, putting the money into the new company’s plan is possibly not the best thing.

Here are five 401(k) options to consider when taking a new job:

• Direct rollover to the new company’s 401(k). A direct rollover is a transfer of assets that allows those retirement savings to grow and remain tax-deferred without interruption. It goes directly into the new employer’s retirement plan without ever passing through your hands. If you have at least another 10-12 working years left with the job change, this is often a preferred route to take. One of the advantages is a 401(k) offers lower-cost or plan-specific investment options.

• Direct rollover to a traditional IRA. People roll over a 401(k) to an IRA to have wider investment options and more control over their money. You don’t pay taxes on IRA contributions or gains until withdrawing the money, which you can do starting at age 59 ½. With a traditional IRA you contribute pre-tax dollars, and that money grows tax-deferred. This might be a better option for those closer to retirement. At that point you want lower-risk investments, and moving your money from a 401(k) to an IRA will give you a variety of fixed-income options. 

• Convert to a Roth IRA. Contributions to a Roth are taxed when they’re made. The upside is you can withdraw contributions and earnings tax-free at age 59 ½. If you have a relatively small 401(k), maybe it’s worth it to convert to a Roth and pay the taxes up front. I certainly think Roth conversions can be a great situation, but they have to be done delicately. 

• Leave it behind. Leaving your money in your former employer’s plan may make sense if you like the investment options it offers, or if you’re taking time to explore other options. The downside is you’re no longer contributing to it.

• Cash it out. This is almost never a good idea, due to the tax implications and the hit your overall retirement fund takes. People who have financial distress will take the 401(k) distribution, but if there’s any way to avoid that they should. There’s a 10 percent early withdrawal penalty if you are under age 59 ½. The exception to this rule is if you are leaving or losing a job at age 55 or later, but the distribution counts toward that year’s taxable income. 

Whatever one decides, the key considerations are continuing the tax-deferral of these retirement funds for as long as possible, and to avoid current taxes and penalties that can take big chunks out of what you’ve saved and invested.       

Christy Smith is founder and principal of Presley Wealth Management (www.thepresleygroup.net). She co-hosts a weekly radio show, “Your Money Matters,” and is author of the book, “Plan, Protect, Preserve.” 

We’ve all heard the expression in business, “Fake it until you make it.” 

Starting out in the advertising business, I was a nervous-norvus any time I had to present to an audience of more than one or two people. I remember my boss’s advice at the time. “Fake it until you make it. Just smile, act like you know your topic better than you do, deliver your pitch with confidence, and you’ll get there,” he counseled me. I got the message. And I’m still getting it. That is what it takes sometimes.

But I learned something recently by volunteering as a judge at the 2019 Future Business Leaders of America (FBLA) New York State Leadership Conference, which was held in our town. As I sat through and evaluated eight teams of statewide high-school students’ five-minute presentations of their public-service announcements (PSAs) on the topic of “the importance of soft skills in the workplace,” I learned a lot about soft skills, especially communication. 

More importantly, I was reminded how an audience actually judges a presentation. I learned anew that first impressions are huge. I experienced how a smile, eye contact, and pleasant greeting instantly establish likability. And I rediscovered the power of passion for one’s subject. 

Five minutes is plenty of time to sort out which students truly had bought into their pitch — versus the dude who couldn’t wait for it to just be over. The deciding factor in rating the presentations, for this judge anyway, turned out to be: who believes in what they are presenting? Who has a passion for it?

Our first-place presenters turned out to be a dynamic duo that knew their stuff, owned it, had done the research, made a strong PSA, stated their objective and made their case, choreographed a dynamic and interactive presentation, and smiled and interacted with the judges — making appropriate eye contact the whole time. They did all this in four minutes and change. These kids will go far.

Then there was Heavenlee, a name that testified to this young lady’s oratorical skills. It was just her in that room. No Powerpoint. No theatrics. Just her and the PSA she had shot, herself, using her iPhone. Heavenlee wove a story that had us judges captivated with its honesty. She didn’t check all the boxes for production or technical prowess, but she more than made up for any deficiency there with sheer believability, impeccable body language, command of words, and powerful delivery. 

Authenticity is a word that is widely bandied about but sorely lacking in this age of social media. It doesn’t get more authentic than a high-school student standing in front of two judges, telling her story, without notes, and without editing. The students that made it through to the regional, state, and national finals made their points by talking with the judges, not at them. So that, I guess, is the point I’m trying to make. Yes, in business sometimes we need to fake it until we make it. On the other hand, if we really want our audience to buy what we are selling, to practice what we are preaching, or to take the next step, we had better be authentic. We had better interact. We had better connect. And, we had better believe it before we present it.

As for the FBLA, this was my first experience with the esteemed 50-year-old institution. I wish I’d known about it when I was 16. It gave me a new appreciation for the quality, character, and drive of today’s youth. It renewed my hope that we (society) will “make it.” I would recommend volunteering to be an FBLA judge, timekeeper, or administrator. This is the organization’s creed:

I believe:

• Education is the right of every person.

• The future depends on mutual understanding and cooperation among business, industry, labor, religious, family, and educational institutions, as well as people around the world. I agree to do my utmost to bring about understanding and cooperation among all of these groups.

• Every person should prepare for a useful occupation and carry on that occupation in a manner that brings the greatest good to the greatest number.

• Every person should actively work toward improving social, political, community, and family life.

• Every person has the right to earn a living at a useful occupation.

• Every person should take responsibility for carrying out assigned tasks in a manner that brings credit to self, associates, school, and community.

•  I have the responsibility to work efficiently and to think clearly. I promise to use my abilities to make the world a better place for everyone.

For more on the FBLA, visit: fbla-pbl.org.

Steve Johnson is managing partner of Riger Marketing Communications in Binghamton. Contact him at sdjohnson@riger.com