If you don't need your retirement money in a hurry, rolling it over into a traditional IRA may make sense. Instead of putting the money into a bank account and paying tax on the earnings, you can defer taxes on both the contributions and the earnings if you put the money in a traditional IRA. It is to your advantage to make it a direct rollover. This way, you don't have to get involved in the transfer and no taxes will be withheld.
