A simple strategy can make retirement savings less complicated, no matter how many jobs you've held and accounts you've opened

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A 401(k) rollover isn't as complicated as it sounds.

• A 401(k) rollover might sound complicated, but it just means moving retirement savings from one tax-advantaged retirement account to another.
• People often do this after leaving a job, to consolidate their retirement savings for easier record-keeping and sometimes, for more advantageous investments.
• Many 401(k) plans are notorious for high fees and limited investment choices, and rollover options typically include a 401(k) with a new employer or a Rollover IRA of your choice.
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A 401(k) is a tax-advantaged, employer-sponsored retirement account that has special rules.

Unlike a regular checking or savings account, where you can add and withdraw funds at any time with few limits and no major tax implications, you can't just withdraw from a 401(k) at any time.

Withdrawals from a retirement account must be done in accordance with the account's rules and age requirements. Typically you have to be at least 59 ½ years old to make a withdrawal. If you take out your funds early, you'll have to pay both taxes and a penalty.

Read more: Here's exactly how to figure out when you can retire

A "rollover" is simply arranging to move the money from your 401(k) to another retirement account - not to a checking or savings account. Because you're putting the money in another retirement account, the rollover allows you to avoid the taxes and penalty that would come with a withdrawal as long as you deposit the funds in a new tax-advantaged account quickly enough. Current rules require you to deposit the funds in your new account within 60 days.

A rollover is considered a transfer, not a contribution, which means that, for instance, rolling over $8,000 from your 401(k) into an IRA wouldn't exceed the $6,000 annual contribution limit ($7,000 for ages 50 and over) for the IRA.

Why move money out of an old 401(k)?

Opening a new account and moving the funds takes a little bit of work, but the hassle can be well worth it.

The reasons: avoiding expensive 401(k) management fees and getting access to a wider range of investment options. Also, if you change jobs, it might be more convenient to move your money so you can stop keeping track of old accounts.

The typical 401(k) fee today ranges between around 0.50% and 3% depending on the size of your employer's plan. Bigger companies with larger plan assets typically get lower rates. Those at small businesses and mid-sized employers pay more. Compare that to most IRA accounts at major US brokerages, which charge zero monthly or annual fees for the most part.

Read more: 3 major expenses no one can avoid in retirement

Employer 401(k) plans also offer a limited number of investments. But even if you are lucky enough to get low-cost funds, you probably won't have access to the entire fund family or any competing funds.

With an IRA at your favorite brokerage, you can choose from any mutual fund, ETF, stock, or other tradeable asset offered by your account provider. In most cases, that is the entire list of US mutual funds and ETFs as well as a range of international investments.

Where should retirement funds go after a rollover?

Choosing a brokerage if you don't already have one is easy. Several top brokerage houses that offer Rollover IRA accounts perfect for just about anyone. Here are some major considerations when choosing an account provider:

• Account fees. The first thing to consider when choosing a Rollover IRA is the fees. If an account charges any recurring fees, you should consider skipping it. Many large and reputable companies offer this type of account free of any type of maintenance, minimum balance, and account fees.

• Investments available. Unlike your 401(k), your rollover should give you exactly the investments you want.

• Trading fees. Some brokers give you a list of their own mutual funds and ETFs available to trade with no commissions. This can be very valuable. While you probably shouldn't be trading actively with your retirement money, those fees do add up over time regardless. If you can avoid them, that's a big win!
• Convenience. If you already have a brokerage account somewhere, you might just want to open up your Rollover IRA there if you are happy with your account and customer service.

If you don't feel comfortable managing your retirement investments, one option is to consider a robo-advisor. These investment managers choose your funds for you from a list of low-fee ETFs based on a risk and goal survey you fill out when opening a new account.

If you have a chain of ex-retirement accounts from old jobs, it's usually a good idea to roll them all over into one consolidated account. This helps you save on fees, choose the investments you want, and simplifies your life. It's much easier to manage one account than several.