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GOBankingRates’ editorial team is committed to bringing you unbiased reviews and information. We use data-driven methodologies to evaluate financial products and services – our reviews and ratings are not influenced by advertisers. You can read more about our editorial guidelines<\/a> and our products and services review methodology<\/a>.<\/p>\n 20 Years Trusted by A 2025 study by Capitalize<\/a> estimates that Americans have forgotten and abandoned 31.9 million 401(k) accounts. The total retirement savings in those accounts: $2.1 trillion. That\u2019s $2,100,000,000,000, to convey its full weight.<\/p>\n It gets to the heart of one of the greatest retirement<\/a> red flags that no one talks about: Americans having too many accounts. Beyond the obvious risk of forgetting about the account \u2014 like the 31.9 accounts found by Capitalize \u2014 too many retirement accounts come with other risks, as well<\/a>.<\/p>\n Unknown Asset Allocation<\/p>\n In a single account, or even two accounts at the same brokerage, it\u2019s relatively easy to view your asset allocation. The brokerage can likely break down your stocks versus bonds versus alternatives, and then further break down domestic versus international and so forth.<\/p>\n But what happens when you have two, three, four 401(k) accounts<\/a>, all at different custodians? It gets much harder to track how much you have in each asset type. And that says nothing of your IRA accounts, your taxable brokerage accounts and other investments.<\/p>\n If you don\u2019t know your asset allocation, you can\u2019t rebalance your portfolio. You\u2019ll also end up with duplicate investments, which adds to your risk.<\/p>\n Tax Planning Complications<\/p>\n \u201cWhen you\u2019re dealing with pre-tax dollars in one place, Roth money in another and after-tax funds somewhere else, coordinating moves like conversions and withdrawals becomes a lot more complicated,\u201d notes Anthony Saccaro, president at Providence Financial & Insurance Services<\/a>.<\/p>\n It also gets complicated when you receive 1099s, and boosts the odds of one of them being forgotten or lost. That sets you up for trouble with the IRS.<\/p>\n Beneficiary Tracking<\/p>\n You set the beneficiary<\/a> for each account. But with each account you stack on, the odds increase that you\u2019ll lose track of who should get what, or update your beneficiary as your wishes change.<\/p>\n \u201cAs an estate planning attorney, I\u2019ve seen deceased or ex-spouses get the money when the account holder passed away because the beneficiary form was never updated,\u201d adds Saccaro. \u201cIf something happens to you, that\u2019s the last thing you want your family sifting through.\u201d<\/p>\n Backdoor Roth Conversions<\/p>\n Having multiple retirement accounts makes it complicated to make a backdoor Roth conversion. Financial planner Jay Zigmont of Childfree Trust<\/a> notes that the IRS rules get complex quickly. <\/p>\n![\"\"](\"https:\/\/cdn.gobankingrates.com\/wp-content\/uploads\/2023\/11\/icon-20.svg?webp=1&quality=75\"){kind=icon}
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