What is a rollover IRA and should I move my old 401(k) into one?

A rollover IRA holds money moved out of a former employer's 401(k), preserving its tax-deferred status without triggering taxes or penalties. Rolling an old 401(k) into an IRA often gives you far more investment choices and lower fees, and consolidates accounts you might otherwise lose track of. Use a direct (trustee-to-trustee) rollover so the check never comes to you – an indirect rollover forces 20% withholding and a 60-day deadline. One caution: a large pre-tax rollover IRA can interfere with a clean backdoor Roth because of the pro-rata rule, so if you do backdoor Roths, rolling into your new employer's 401(k) instead may be smarter. Compare fees and fund options before moving, and never cash out – that triggers tax plus a 10% penalty if you're under 59½.