Moving back to UK. 401K question

We plan to move back to the UK next year after 30+ years of living in the US.  We both have US and UK citizenship, have 401k's here and have been told by our financial advisor that we cannot keep them here unless we have a US address. As we won't have reached retirement age when we move, how do we avoid paying huge tax penalties for cashing them out early?  Or, does anyone know how to keep them here until we reach retirement age? Thanks.

We plan to move back to the UK next year after 30+ years of living in the US.  We both have US and UK citizenship, have 401k's here and have been told by our financial advisor that we cannot keep them here unless we have a US address. As we won't have reached retirement age when we move, how do we avoid paying huge tax penalties for cashing them out early?  Or, does anyone know how to keep them here until we reach retirement age? Thanks.

I just talked to my son last night about this very thing. He is doing the same thing we did, and has now opened an account with HSBC, linked to his existing Vanguard brokerage accounts. Both companies allow overseas addresses, but Vanguard won't allow new accounts to be created so he has now got an IRA with them and will roll his 401k to that IRA after leaving his company and before changing his address to his UK address.

We plan to move back to the UK next year after 30+ years of living in the US.  We both have US and UK citizenship, have 401k's here and have been told by our financial advisor that we cannot keep them here unless we have a US address. As we won't have reached retirement age when we move, how do we avoid paying huge tax penalties for cashing them out early?  Or, does anyone know how to keep them here until we reach retirement age? Thanks.

Your financial advisor is wrong. Talk to your 401k administrator about your plans and if there are issues roll the money into an IRA with someone like Vanguard or Schwab before you move to the UK.

Thanks durhamlad and nun.  Both helpful comments.

I do not know about 401k. However , as mentioned already you can certainly keep it if you roll it into IRA. Better still if you can convert to IRA-Roth. ( even though you have to pay the appropriate taxes now). That way when you begin to take distributions in the future they will be tax free (much less hassle to file for UK/US taxes). And you must do that BEFORE you leave US.