401(k) plans are by far the largest source of income and capital for most retirees. That’s why it’s important to make sure you’re making the most of your plan’s potential by finding ways to reduce costs and make smarter investment choices. Edward Gottfried of Betterment suggests that the easiest way to lower costs is to move your money from mutual funds that charge you 1% or more in annual investment management fees into index funds with fees ranging from 0.05% to 0.25%. Online tools like Blooom can analyze all of your plan’s funds and suggest less-expensive alternatives. It’s also important to make sure that your asset allocation—your current mix of stock funds, bond funds and cash--reflects your investment goals, timeframe and risk tolerance. As you approach retirement, you may want to reduce your allocation to stocks to protect against potential losses in your portfolio should the market plummet when you need to start making withdrawals. However, it’s important to keep some exposure to stocks because they’re more likely to keep your portfolio growing faster during retirement than if you only invest in bonds and cash.

When you retire, or move to a different company, you need to decide what to do with the assets in your former employer’s 401(k) plan. If you’re switching jobs, it only makes sense to transfer assets from your old plan if your new company’s plan offers better investment options and lower costs. But for most people, moving 401(k) plan assets into a brokerage Rollover IRA makes the most sense. A Rollover IRA gives you access to thousands of different mutual funds and ETFs and most offer online retirement planning tools to help you determine an appropriate asset allocation model and select investment options. If you don’t want to make your own investment decisions, consider rolling over your 401(k) assets into an IRA professionally managed by a fee-only fiduciary investment adviser.