Do you have 401(k) orphans?

401k  Have you switched jobs and not taken your 401(k) with you?
Leaving an employer is hard enough and you may have left your 401(k) at the old job. This is your nest egg and it may have been lost in the shuffle. Even small accounts can compound and make a big difference down the line. Especially if you have left accounts at several businesses.
Now is the time to take action. The easiest way to locate an orphaned account is to call the human resources department at your former employer. They can direct you to the plan provider. If the company has gone out of business, there is a National Registry of Unclaimed Retirement Benefits.
This may be the time to take control of your money and create an IRA. You may combine several of those small 401(k)s into one account and make it easier to track. We have products that start with $2,000 to $5,000 and up.
Example: I was helping a client go through paperwork from previous jobs. It showed that she had been contributing to her 401(k) at each job. Next she called each company and asked if the account was still open. She had moved all of her accounts but one! She found $20,000 that had not been moved and she didn’t remember having. Needless to say, she was very happy!
You may not be aware that you are contributing to your 401(k). Many companies make it an automatic deduction unless you request not to be in the fund. It will be on your pay stub and also on your W2 at the end of the year.
Whatever you do, do not cash it out! There could be penalties with the IRS and you could have income tax on the distributed amount. If you do have the funds sent directly to you, create a paper trail. You have 60 days to get the money into another 401(k) or IRA without penalty.

Do you have 401(k) orphans?
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