If you’re among the millions of workers who have left their job as part of the so-called Great Resignation that’s still rumbling through the labor market, be sure not to neglect your 401(k).

While you may have options for how to handle retirement savings in your ex-employer’s plan, there are situations when the decision is made for you if you don’t take action — and it may not be in your best interest.

“It’s best to take care of this in the first couple months of that transition to a new job,” said Haley Tolitsky, a certified financial planner at Cooke Capital in Wilmington, North Carolina.

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Workers continue to quit their jobs at near-record levels in search of better opportunities in a tight labor market. About 4.3 million people voluntarily left their jobs in May, about the same as in April and down just slightly from more than 4.4 million in March.

While not everyone has a 401(k) plan or similar workplace retirement plan, those who do should know what happens to their account when they leave a job and what the options are — and aren’t.

Broadly speaking, you have several options for your old 401(k). You can leave it where it is, take it with you into your new workplace plan or an IRA, or cash it out — although experts generally caution against doing so.

Perhaps the easiest thing you can do is leave your retirement savings in your former employer’s plan, if it’s permitted. Of course, you can no longer contribute to the plan.

However, while this might be the easiest immediate choice if it’s available, it could lead to more work in the future.

Basically, finding old 401(k) accounts can be tricky if you lose track of them. There is, incidentally, pending legislation in Congress that would create a “lost and found” database to make locating lost accounts easier.

“It’s really common,” Tolitsky said. “People switch to a new job, they have life changes going on, they forget about it, and then 10 years later they aren’t even sure who [the 401(k)] was with or who the provider was.”

Also be aware that if your account is small enough, you may not be able to keep it at your ex-employer even if you want to.

If the balance is between $1,000 and $5,000, your ex-employer can roll over the amount to an individual retirement account, or IRA. If the balance is less than $1,000, the plan can cash you out — which can lead to a tax bill and an early-withdrawal penalty.

“If you can avoid it, you don’t want to cash out your 401(k),” said Kathryn Hauer, a CFP with Wilson David Investment Advisors in Aiken, South Carolina. “Doing so with a traditional 401(k) means you’ll probably pay a 10% tax penalty.”

Your other option is to transfer the balance to another qualified retirement plan. That could include a 401(k) at your new employer — assuming the plan allows it — or a rollover IRA.

Be aware that if you have a Roth 401(k), it can only be transferred to another Roth account. This type of 401(k) and IRA involves after-tax contributions, which means you don’t get a tax break up front as you do with traditional 401(k) plans and IRAs.

However, the Roth money grows tax-free and is untaxed when you make qualified withdrawals down the road.

While any money you put in your 401(k) is always yours, the same can’t be said of employer contributions.

Vesting schedules — the length of time you must stay at a company for its matching contributions to be 100% yours — range from immediately to up to six years. Any unvested amounts generally are forfeited when you leave your company.

Among 401(k) plans that allow participants to borrow money, roughly 13% of people had a loan outstanding last year, according to Vanguard’s How America Saves 2022 report. The average balance was $10,614.

If you leave your job and haven’t paid off those borrowed funds, there’s a good chance your plan will require you to repay the remaining balance fairly quickly. Otherwise, your account balance will be reduced by the amount owed — called a “loan offset” — and considered a distribution.

In simple terms, unless you are able to come up with that amount and put it in a qualifying retirement account by the following year’s tax-return deadline, it is considered a distribution that may be taxable. And, if you are under age 59½ when you leave the job, you may pay a 10% early-withdrawal penalty.

About a third of employer plans allow former employees to continue paying the loan after they leave the company, according to Vanguard. This makes it worthwhile to check your plan’s policy.

It’s worth talking to a financial advisor before moving your old 401(k). In addition to portfolio considerations such as investment choices and fees, there may be planning consequences.

For example, there’s something called the Rule of 55: If you leave your job in or after the year you turn 55, you can take penalty-free distributions from your current 401(k). If you move the money to an IRA, you generally lose the ability to tap the money before age 59½ without paying a penalty.

Additionally, if you are the spouse of someone who plans to roll over their 401(k) balance to an IRA, be aware that you would lose the right to be the sole heir to that money. With the workplace plan, the beneficiary must be you, the spouse, unless you sign a waiver allowing it to be someone else.

Once the money lands in the rollover IRA, the account owner can name anyone a beneficiary without their spouse’s consent.