I’m 53, just got laid off, and wondering what to do now. I have $425K saved for retirement, $10K in an HSA, and a property I could sell for an extra $200K in cash. Is getting professional help wise? 

Question: I was laid off from my job of 12 years. I have a few questions about how to rearrange my future financial plan. I am 53 years old and I plan to go back to work once I find a job in the next few months. I am married, but I have separate financial accounts from my husband. I have $350K in a 401(k), $75K in an IRA with a different financial company, and a HSA account with $10K. Should I move all investment accounts to a single investment account and if so, how do I do this and will it have any tax impact that I might want to avoid? I also plan to sell my property which may give me an additional $200K in cash once it is sold. Is it a good idea to consolidate all assets to a single investment account or should I invest them into different vehicles? 

Answer: We are so sorry to hear about your job loss, but congratulations on the savings you’ve built up and the property you could profit on. There’s a lot to unpack here, so we will tackle your questions one by one, and address whether or not you might want to hire a pro to help you. (Looking to hire a financial adviser? You can use this tool to get matched with an adviser who might meet your needs.)

Pros and cons of consolidating retirement accounts

Consolidating retirement funds (like your 401(k) and IRA) in one location can make sense — but it’s not always the right move. (And pros say your HSA funds are another matter). 

On the pros side of consolidating your retirement funds: “Consolidation makes it easier to track your assets, to select from a wide range of funds, ETFs or individual stocks or bonds, to keep costs low, to get professional management and to access your money when the time comes,” says certified financial planner Tom Belding of Belding Financial Planning.

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You may want to consolidate your 401(k) and traditional IRA — either into the existing IRA or into a new one, depending on how your experience with your IRA custodian has been so far — by initiating a rollover with the IRA custodian, says certified financial planner Cristina Guglielmetti of Future Perfect Planning.  (Note that if your IRA is a Roth IRA, you likely wouldn’t want to merge that with your 401(k) for tax purposes, because with the 401(k) you’re contributing monies you haven’t paid taxes on and with the Roth IRA, your contributions are made after you’ve paid taxes.)

However, “if you expect to return to work soon, it may be worth waiting to examine what retirement savings plan offered at the new employer is like. If the investment options are good, it might make more sense to eventually roll everything over into that plan for ultimate simplicity,” says Guglielmetti. To do this, you’ll need to contact your new 401(k) provider and initiate rollovers with them, then invest the money,” says Guglielmetti. 

And if you think you might need to borrow from a future 401(k), you may want to keep 401(k) funds separate. (A 401(k) plan often gives the participant the ability to borrow from their account, though this comes with risks like paying penalties, repayment costing more than your original contributions, resetting the repayment clock if you lose your job and more.)

“As a former employee, you will not be able to borrow from your old plan, but once you find a new job and if you have a 401(k) plan and it allows rollovers with borrowing privileges and you want that option in the future, you may want to keep your 401(k) money separate from other accounts,” says certified financial planner Scott O’Brien of WorthePointe. You can also roll your money from the existing 401(k) to an IRA without penalty, and then reverse the funds into a new 401(k) when you have a new job. 

You’ll also want to make sure you reevaluate issues like investment advisory fees that could be reduced by consolidation accounts and the quality and cost of the investment options used within your various accounts. “Consider your goals for these funds. Will you use them to buy another property or fund other goals in the near future? If so, high-risk investments may not be appropriate,” says Daniel.

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Are there tax implications to consolidating retirement accounts?

Transfers that are rollovers via custodian to custodian transfer, a direct transfer between to financial institutions, shouldn’t suffer any current tax consequences. “You should not ask for a distribution of a check made out to your name, or a 60-day rollover time period will start for you to get those monies into a retirement account. If the 60-day time period elapses without the check being deposited in a retirement account, then you will be taxed on any non-Roth monies,” says O’Brien.

What to do with an HSA

It’s wise to keep your HSA separate from your retirement accounts, but if your eventual new employer offers an HSA, it might make sense to roll the old one into the new one. An HSA lets you contribute pre-tax dollars without paying taxes on earnings and you can withdraw the money tax-free anytime to pay for medical expenses.

Note that many HSA accounts have investment options. “Now that you have separated from your company, consider moving your HSA to a provider that charges lower fees or offers better investment options,” says certified financial planner Matthew Daniel of Columbus Wealth Management.

What to do with the proceeds from the sale of a property

“If you sell a property and want to invest the proceeds, that money will need to be in a brokerage account that’s different from the 401(k), IRA and HSA. These accounts can’t be mixed without running into an unwanted tax consequence,” says Guglielmetti. 

While your idea of consolidating to a single investment account may sound desirable, unfortunately, it’s not a good option. “The retirement accounts, HSA and taxable account with proceeds from the house need to be in separate accounts. Of course, you might be able to take some of the proceeds from the house and contribute to your IRA or HSA depending on your personal situation,” says O’Brien. 

Should you hire a financial adviser? 

The answers above should start you off on the right path without you immediately needing a financial adviser, especially as you are currently jobless and trying to save money. That said, should you feel like you need financial or investing guidance, an adviser may be smart. Here are the 15 questions you should ask any adviser you might want to hire, and how to vet the person as well. In your case, an hourly or project-based adviser might make sense who has experience both with real estate and retirement planning. (Looking to hire a financial adviser? You can use this tool to get matched with an adviser who might meet your needs.)

Have an issue with your financial adviser or looking to hire a new one? Email [email protected].

Questions edited for brevity and clarity.