The U.S. Labor Department says that 1,650 401(k) plans left unclaimed every year. The Forbes article “How To Track Down That Lost 401(k) Or Pension,” reports that Americans lost track of more than $7.7 billion worth of retirement savings accounts – and that’s just in 2015. Can you unearth old retirement accounts, even if they have been inactive for years?
With people jumping from job to job, they can often leave a trail of old retirement accounts and even a few pensions behind. Therefore, a surprising number of people lose track of these old accounts. Forgetting about these accounts can really cost your overall retirement security, and leave needed income untapped .
Let’s look at how to start your search for lost retirement assets. Hopefully, you have an old statement or benefit information. If not, the first step is to inventory and track down your previous employers. Send them an email or letter asking for information about your accrued retirement benefits.
If you emplyee has moved, changed its name or gone out of business, it can be more difficult. It is possible to try sources like the Labor Department and nonprofit pension counseling centers. The Pension Benefit Guarantee Corporation (PBGC) also provides help in tracking down traditional pensions. There are databases that list corporations and bankruptcies.
These databases may be able to help you track down the missing retirement plans, because each plan is required to file an annual report with the IRS. If you can track down this form, it should contain the plan’s contact information and employer’s identification number. With this information, you can likely determine where the plan is now, or who inherited it during a corporate merger or other change.
If your previous employer has terminated its defined benefit pension plan, check with the PBGC. They have a database of missing participants in the underfunded pension plans it has taken over.
If a company terminates a 401(k) plan, it’s required to transfer all accounts to the plan’s participants. When they can’t locate a participant, the firm can then send the money to an IRA, a bank, or even a state’s unclaimed property fund.
It’s worth the time and effort to track down these accounts. They may not make you rich, but if you discover that you have several small accounts, that can add up. Why not track them down? It’s your retirement money!
If you need help or guidance, please do not hesitate to contact our Firm.
Reference: Forbes (April 15, 2018) “How To Track Down That Lost 401(k) Or Pension”