How Does A 401K Work If You Quit? 
The 401 -LRB- k -RRB- is governed by a document drawn for the employer . Most plans offer a variety of distributions when you terminate , but they are not required to do so . Exercising these options can be quite important . Generally you would want to maintain the character of the funds . If they are tax deferred funds you would want them rolled into a standard IRA . If your income tax is going to be low you can consider rolling it into a Roth IRA and pay the tax for the withdrawal as though it were ordinary income , which is often an alternative . 