Jill on Money with Jill Schlesinger – Episode: "Job Change With No 401(k)"
Release Date: July 24, 2025
Host: Jill Schlesinger, CFP®
Guest: Mark T. McGowan
Introduction: Navigating Job Changes and Retirement Planning
In this episode of Jill on Money, host Jill Schlesinger delves into the complexities of managing retirement funds, particularly focusing on scenarios where individuals change jobs and find themselves without access to a 401(k) plan. Jill emphasizes the importance of strategic financial planning to ensure a secure retirement despite such transitions.
The Role of AI in Financial Advisory
Early in the episode, Jill shares her thoughts on artificial intelligence (AI) in the financial sector. Reflecting on a New York Times article, she highlights the unique human element in financial advising that AI cannot replicate.
Jill Schlesinger [04:30]: "Biography is a form built on the vagaries of human experience. Artificial intelligence offers a form of knowledge stripped of experience."
Jill contrasts AI's ability to process language and predict trends with the nuanced understanding humans possess regarding motives and experiences. She concludes that this human touch is crucial in financial advisory roles, assuring listeners that professionals like herself and Mark remain indispensable.
Listener Questions and Expert Advice
1. David’s Retirement Dilemma [06:15]
Question: David, age 65, is contemplating whether to take a lump sum from his pension or opt for a monthly benefit. He has $640,000 in his 401(k), a lump-sum pension option of $423,000, and a preferred monthly pension of $1,500 with a 50% survivor benefit. Additionally, he has $275,000 in cash savings.
Advice: Jill advises David to assess whether he can comfortably live on the combined income of the monthly pension and Social Security benefits, which would total approximately $4,500 monthly.
Jill Schlesinger [09:20]: "Can you live on 4,500 bucks a month? That's a big question. If you can, then maybe take the monthly pension to give her some peace of mind."
She suggests that if David and his wife can sustain their lifestyle on this income without depleting their savings, opting for the monthly pension may be the more secure choice.
2. Kathy’s Missing 401(k) After Job Change [10:45]
Question: Kathy recently changed jobs and discovered her new employer doesn't offer a 401(k). With four years until retirement, she's unsure how to handle her previous 401(k).
Advice: Jill outlines three primary options for Kathy:
- Leave the 401(k) with the Previous Employer: If the plan allows, especially if it's robust with reputable funds like Vanguard or Fidelity.
- Roll Over to a New 401(k): Not applicable in Kathy’s case since her new employer doesn’t offer one.
- Roll Over into an IRA: Transferring to an IRA through providers like Fidelity, Schwab, or Vanguard is recommended for better control and potentially lower fees.
Jill Schlesinger [12:10]: "When you have an old retirement plan, leave it where it is, move it into a new plan, which you can't do, or roll it into an IRA rollover account."
She encourages Kathy to consider an IRA rollover, especially given her proximity to retirement, to maintain and potentially grow her retirement savings effectively.
3. Georgianne’s Universal Life Insurance Policy [14:00]
Question: Georgianne, age 69, holds a universal life insurance policy with a $50,000 coverage and a current surrender value of $7,125. She contemplates whether to surrender the policy and invest the cash.
Advice: Jill advises Georgianne to evaluate her overall financial situation and dependencies.
Jill Schlesinger [15:00]: "If you have other assets and nobody really needs this money, then invest it elsewhere. But if you rely on this policy, reconsider."
She suggests that if Georgianne has sufficient assets and no dependents relying on the policy, surrendering it and reallocating the funds could be beneficial. However, she stresses the importance of understanding the broader financial context before making a decision.
4. John’s Third Marriage and Social Security Strategy [16:15]
Question: John and his wife, both in their sixties, are discussing the optimal time to apply for Social Security benefits. With substantial retirement funds, they aim to maximize their monthly income.
Advice: Jill recommends delaying Social Security benefits to increase monthly payouts, especially since both are in good health.
Jill Schlesinger [17:00]: "When you're in good health and don't need the money immediately, waiting until full retirement age or even age 70 can maximize your benefits."
She emphasizes that delaying benefits can provide a larger monthly income, which is advantageous for long-term financial stability.
5. Jeff’s Brokerage Account vs. Roth 401(k) [18:30]
Question: Jeff, aged 58, and his wife, 60, plan to retire in two years. With solid retirement savings and a modest mortgage, Jeff is considering whether to bolster his brokerage account instead of contributing further to his traditional 401(k).
Advice: Jill discusses the merits of Roth contributions versus brokerage investments.
Jill Schlesinger [20:00]: "I don’t think you should start withdrawing at 60 unless you're in bad health."
She advises maintaining contributions to the Roth 401(k) for tax-advantaged growth, while also building the brokerage account to provide flexibility during retirement. Jill highlights the importance of not depleting retirement funds prematurely and leveraging diverse income streams.
Conclusion: Strategic Financial Planning is Essential
Jill wraps up the episode by reiterating the importance of personalized financial strategies, especially during job transitions and approaching retirement. She encourages listeners to utilize the resources available on the Jill on Money website and consider reaching out for tailored advice.
Jill Schlesinger [22:45]: "Whatever's on your mind is important to us. Just go to our website, jillonmoney.com, click the contact us button, and reach out."
Final Thoughts
This episode underscores the significance of proactive financial management when facing job changes without a 401(k). Through real listener questions, Jill Schlesinger provides actionable insights and underscores the value of individualized financial planning to achieve retirement goals.
Resources Mentioned:
- Website: jillonmoney.com
- IRA Providers: Fidelity, Schwab, Vanguard
- Podcast Subscription: Jill on Money Live – Access to live webinars and bonus content
Join the Conversation: Listeners are encouraged to submit their financial questions via the website for future episodes and to engage with the Jill on Money community for ongoing support and information.