When you change jobs and leave an employer that has a 401(k) or other defined-contribution retirement plan, you usually arrange to transfer your retirement account. (This is not the case with a defined-benefit plan, which pays you a fixed benefit based on what you have vested.)

With a defined-contribution plan, you ask your ex-employer to transfer your plan assets to a new retirement plan or IRA using either a trustee-to-trustee transfer or lump-sum distribution.

Use this calculator to see if you are saving enough or might want to make changes.

With a trustee-to-trustee transfer, you don't handle the money. Instead, your ex-employer or another trustee transfers your plan assets to the trustee of the new retirement plan or IRA that you designate. As a result, you pay no income taxes and avoid an early-withdrawal penalty.

With a lump-sum distribution, you do handle the money. You have 60 days to complete a rollover, which involves moving the plan assets to your new employer's plan or an IRA. If you pass the 60-day deadline, you will owe income taxes and face an early-withdrawal penalty. (If you're 59 1/2 or older, the penalty won't apply.)

You are only allowed one rollover in a year with a lump-sum distribution. The clock starts ticking on the date you take your distribution. Furthermore, your ex-employer is required to withhold 20% of the lump sum for income taxes. In order to recover this 20%, you must scrape together the amount of the withholding from another source.

For example, say you are age 52, have $250,000 in your retirement plan, and accept a lump-sum distribution. Your employer withholds 20%, or $50,000, and distributes $200,000 to you. You have 60 days to recover the $50,000 that was withheld and roll over the full $250,000 to avoid the 10% penalty.

If you were born before 1936, you may be able to stretch out your tax bill over 10 years. For more on this rule, see "Lump-Sum Distributions" in IRS Pub. 575: "Pension and Annuity Income."

Instead of moving your retirement plan, you may be able to leave your plan with your ex-employer if the plan has more than $5,000 in assets. Your decision to leave your assets with your ex-employer's plan will likely be influenced by the investment performance of your retirement plan at your ex-employer. You may decide you will earn higher investment returns by leaving your plan assets where they are.

Use this calculator to see how much you can earn from your retirement account.

The above information is educational and should not be interpreted as financial advice. For advice that is specific to your circumstances, you should consult a financial or tax adviser.