Good response and makes sense . You ' re definitely diving in deep and beyond superficial attributes , while still judging superficial attributes , if that makes sense lol . Going off of that goofball picture of Joe , which I found hilarious and kind of want to show my wife she ' s in love with him , we agreed that Joe and Sophia would easily be our respective hall passes lol , he was definitely average at best back then and Hollywood certainly did him every favor in the world . He looks like your typical college douchebag in that picture , who only scores with airheads who fall for any line thrown their way while being 5 appletinis deep at a frat party . <| sep |> 401 k plans are required to have summary plan documents that outline your rights as a plan participant . The company will need to hire a plan administrator that works on behalf of the participants and enforces the plan rules . Things outlined in the description include the vesting rules you can either have cliff vesting where you go from 0 to 100 % vested in a short period , or graded vesting where you vest a little more each year until full vesting I think the legal limit is 6 years . , the company match amount and when you start getting the match , if the plan allows for withdrawals for emergencies usually the IRS defines what these emergencies are , not the plan called hardship withdrawals , if the plan allows for loans , etc . As part of their job , the manager helps select a portfolio of investments for its participants . Most plans make deals with a fund company to get access to some basic fund styles , like target date mutual funds that diversify your dollars based on a projected retirement date . Plans can also buy large lots of funds from mutual fund companies and get ' institutional ' shares with better management fees and rates . Once you leave your employer , the two main questions about moving your money are how much you have and where you ' re going to put it . All money you have put in is yours . Anything your employer has added is granted based on vesting . For instance , if you work for a company that vests you at 20 % per year for a five year period and you quit 3 years in , you get to keep 60 % of the employer ' s contribution not just what they ' ve added , but any increase in value it has made . They basically take the folder marked ' employer contribution ' and multiply by . 6 Once you leave , you can typically take it out at your discretion once the plan manager has been notified that you are no longer in service . Some plans differ , like if you do contract work or work for an educational institution , they may require 3 months of separation before you can access the money , but for 401 k plans which are mostly corporations you can take it out technically as soon as you quit . Again , though , it takes time for the employer to notify the plan manager , so sometimes you have to wait a bit . If you have less than $ 1 , 000 , they are allowed to force you to cash out if you don ' t move it within a given time period . If you have more than $ 1 , 000 and less than $ 5 , 000 , they can force you into an IRA . These are called De Mnimis rules and help the plan save money on management fees and have some other benefits . What if you have more than that ? Using the same example , let ' s say you ' ve got a company that pays a match of 100 % of the first 5 % of your salary contributions . You make $ 40 , 000 per year , and have never missed a contribution , and you save 10 % of your paycheck . Over three years you ' ve contributed $ 12 , 000 . Your company matches the first 5 %, so from them you ' ve got $ 6 , 000 for a total of $ 18 , 000 . Without going into rates of return , let ' s say that your total portfolio value is up to $ 25 , 000 . If I ' m doing this right it ' s 4 AM , so maybe my math is shit you should own 23 of this portfolio yourself , since you put in 66 . 66 % of the contributions , so you own $ 16 , 665 of this value outright . Your employer contributions total $ 8 , 335 in value . When you leave you get to keep 60 % of that , because of vesting , or $ 5 , 001 . So , you now have $ 21 , 666 . They can ' t force you to leave the plan with the De Minimis rule , so assuming they aren ' t going out of business or shutting down the plan or a few other events , you can leave your money in the plan and invest in anything the plan offers its plan participants . The downside is that you can no longer make contributions to the plan . What you ' ve put in is all you ' re going to put in there unless you go back to work for them . You can also switch to your new employer ' s 401 k plan if they offer one . If you work for a governement or healthcare organization , they may have a different plan structure like a 403 b , 401 a , or 457 b , and some of these will allow outside money to be rolled in and some won ' t . Another option is to put the money into an IRA . IRAs are personal accounts , and comparing 401 k and IRA plans involves a lot , but some of the simplest comparisons would be that 401 k plans typically have institutional shares which usually get better expense ratios ' fee structures ' than the average buyer gets . However , you can usually only buy what the plan offers , so if you want some sort of weird fund there are funds that only invest based on religious or environmental principles , etc or a sector specific fund that the plan doesn ' t have shares in or a deal to offer it to you through the fund company then you probably won ' t get access to it . IRAs also allow you to buy stocks , bonds , metals , and other alternate investments that 401 k plans don ' t usually offer outright , though some plans do offer a brokerage option where you can take part of your holdings usually up to 50 % and put it in a stock account and invest in specific companies . I haven ' t worked much with these though , so I ' m not sure if you can also buy bonds and alternate funds with them . There are other differences , such as having tax withholding requirements on 401 k distributions that don ' t exist with an IRA you owe tax either way , and some employer plans charge their own layer of fees , but those are just a few . I want to make sure I don ' t overlook this nuance of your question any given mutual fund is technically ' a portfolio managed by a firm '. An IRA is basically just an account that can hold a fund , but for self directed accounts you ultimately decide what fund you want , how much risk you want to take , etc . There are managed accounts out there , and some of them are good deals , but if you have an IRA I would call your broker and ask if they offer advice of any kind . A lot of them will give you some level of advice for free . 401 k and other plans differ in that they ' re more regulated and they have what you might call a curated list of investments that the plan manager has chosen . They aren ' t always the best funds based on your personal wants , but they almost always are meant to cover the broadest possible investment styles things like ' invest for when I retire in 20 years ' and ' invest in the SP 500 index ' and ' invest in the bond markets ' and ' put it in cash for now ', etc . Typically you ' re either forced to choose a fund when you start putting money in the plan , or you ' re assigned a target date fund based on your current age . ' He ' s 30 and it ' s 2030 , so put him in the 2065 fund . ' This is a contrast to contributing to an IRA , which usually involves putting the money in and then making a trade to get invested . I talk to a lot of people who have had money going into cash for months or years and basically got no return . Hopefully they at least got the tax deduction . These are the best conversations to have when the market has a had a huge downturn though good news , your value is the same ! One final point I would make is that , as you get older , you will want to rebalance and check up on your plan investments from time to time . Don ' t obsess over market ups and downs . Call your broker or plan provider , or an independent adviser or CFP if you can afford it , and have them walk you through a plan and stick to it . If you do have a target date fund or index fund , even though it may technically keeps some cash and cash equivalents as part of its portfolio , try to move more towards money markets as you get close to retirement . Not a lot , but just enough so that if you get a crash like in 2008 , you won ' t have to pull money out of the marketinvested part of your portfolio to cover bills and plans you ' ve made for the next year to 18 months . If you have cash savings outside of the plan , this may not be necessary , but if you don ' t then it ' s what I would do . If you wonder , why not just take it out of the plan , it ' s because money withdrawn from the plan becomes income for the year you take it out , and can therefore drive up your income tax rate . Taking the money out early just to let it sit in cash doesn ' t usually make sense if you have any other forms of income or are taking out enough to move your bracket up . I ' ve seen a lot of people cripple their retirement savings because they panic and withdraw at the wrong time and don ' t ride the market back up . I ' ve also seen a lot of people throw money away on allin investments and penny stocks thinking they can get rich or beat the index even though they have 0 experience . This is your one life , and once you hit retirement age the odds are that you won ' t be able to reenter the workforce unless your health , skills , and mind are exceptionally good and well preserved . If you can , save like you ' re going to live from 65 to 100 on nothing but what you ' ve put away . Also , keep your beneficiaries up to date make sure they know how to reach your plan provider make sure they know how much each person should get , by percent if not in approximate dollars . Probate sucks . Sorry for the essay .