Indeed, investors with multiple 401(k) plans run the risk of being overweight in one or two individual stocks or sectors within their portfolios.
By transferring 401(k) assets into your new employer's plan, or a single individual retirement account, investors are better positioned to rebalance their holdings when the market shifts.
Save some coin
Depending on the size of your accounts, consolidating multiple 401(k) plans may also yield a cost savings.
Indeed, some brokerage firms tack a small fee onto IRAs worth $5,000 or less.
Likewise, 401(k) plan sponsors often charge record-keeping fees, which can chip away at your earnings.
According to Mecca, however, the bigger issue is service.
"If you have a $500,000 portfolio, but it's spread among five different brokerage firms, you might get assigned a junior broker for each account," he says. "There is a tendency for clients to feel they have not been given the attention they deserve if they split their portfolio up too much."
Another good reason to consider keeping your 401(k) accounts to a minimum is that it "ensures those with responsibility for your assets have your current contact information," says David Wray, board member and past president of the Plan Sponsor Council of America.
Indeed, there are thousands of "lost" 401(k) accounts in the system where former employers have no forwarding contact information.
"If for some reason the former employer is acquired, merged into another company or goes out of business, the account will be maintained but will be very difficult to find when the participant wants it," says Wray.
Do it for your heirs
A final incentive to simplify your nest egg has nothing to do with you.
Consider the beneficiaries to your estate, scrambling to make sense of a scattered portfolio after you've passed on or become physically or mentally incapable of managing your investments in later years.
"We see this all the time," says Mecca. "Clients come into my office and throw a bunch of inheritance statements at me and say, 'I have no idea what this is.'
"Consolidating your accounts makes things easier on them, and that says a lot."