The Cons of Rollover IRA
a. Lose penalty-free withdrawal right
If you have a 401k plan and leave your job in the calendar year you turn 55 or higher, you can take penalty-free withdrawals from that employer's 401k plan. But if you roll that money into a Rollover IRA, you will have to wait until you turn 59.5 to avoid the penalty.
b. Lose RMD protection
If you keep your money in 401k and keep working after 70.5, you do not have to take RMD from your 401k account. Unfortunately if you roll your 401k to a Rollover IRA, you will have to start taking RMD from the time you turn age 70.5.
c. Lose lawsuit protection
Assets in 401k are shielded from lawsuits, which means if someone wins a judgement against you in a personal injury lawsuit, that person can't touch your 401k plan. IRAs do not offer such protection, they are generally protected from bankruptcy, but state laws vary with respect to other types of claims.
d. Create more tax complications
If you roll your 401k into a Rollover IRA account, and later on want to take advantage of the backdoor Roth IRA by contributing after-tax dollar to a IRA then convert it to Roth IRA, you will face a more complicated tax situation - normally the backdoor Roth IRA conversion has no tax issue because your contribution is after-tax money, but now that money has to be lumped with the money inside your Rollover IRA account and recalculate the portion that is tax free, which depending on how much money you have in your Rollover IRA, the tax-free portion could be a very small percentage.