topic Re: 401k advice please in Community Chat

401k advice please

Warrior2022 — Fri, 29 Jun 2018 06:19:20 GMT

In April I quit my job of 18 years. I have another job which I love. However, I need to rollover my 401k. My old employer has not released to the 401k people that I no longer work there. Many phone calls have been made. It's coming up on 3 months.

The investment company told me, they were supposed to notify them within a week of my end of employment. They have contacted my old employer with no response.

Any advice please?

Re: 401k advice please

Big Sister — Fri, 29 Jun 2018 07:41:21 GMT

If you haven't done this already, compose a letter (with several copies) and send it on to Human Resources Dept. of your old company. If you have the name of the HR person, use that name.

Keep a file and log of everything you do in this matter.

Then send copies to the company you eventually want to hold your investments in the 401K.

Get the ball rolling and don't give up.

Perhaps someone else on these boards will have another idea.

Good luck.

Re: 401k advice please

CelticCrafter — Fri, 29 Jun 2018 09:17:58 GMT

Usually the administrator of the fund is listed on the paper work and they are the ones that need to sign off on it.

When my husband moved from one company to a new one and wanted to roll the 401k over, it was a classic case of pass the buck, not my job even though we knew who the person in his old office was. He worked for a small company and it was the bookkeeper that was listed as the administrator.

We finally had to have our financial advisor fax the paper work to that person in old office to get it taken care of.

Re: 401k advice please

Imaoldhippie — Fri, 29 Jun 2018 09:19:05 GMT

Sounds very suspicious to me. Hire a lawyer ASAP.

Re: 401k advice please

OKPrincess — Fri, 29 Jun 2018 10:24:38 GMT

Our financial advisor called and made the transfer for me.

Re: 401k advice please

Jtdmum — Fri, 29 Jun 2018 10:46:59 GMT

State attorney general or Banking commisioner? Secretary of State's office? Run--Don't walk. This sounds shady at best.

You don't say if you worked at a large or small company, public or private.

They should have issued a check to you directly written to you "FBO" (For the benefit of) to deposit direct to your new fund. It should have been out to you within a week of your request.

@Warrior2022 wrote:
In April I quit my job of 18 years. I have another job which I love. However, I need to rollover my 401k. My old employer has not released to the 401k people that I no longer work there. Many phone calls have been made. It's coming up on 3 months.

The investment company told me, they were supposed to notify them within a week of my end of employment. They have contacted my old employer with no response.

Any advice please?

Re: 401k advice please

BirkiLady — Fri, 29 Jun 2018 13:31:17 GMT

@Jtdmum @Warrior2022 No, you do NOT want them to issue a check. It must be rolled over or you will have to pay taxes on the money!

If you have a broker, have him/her fax the documents to the individual at your former company. Follow up within 24 hours to make sure he/she has completed all paperwork. Ask if you could pick it up at your earliest convenience and return everything to your current employer (or wherever you plan to rollover the 401K monies). A little pressure on your former employer may help them realize this is needed immediately! Be firm, but persistant. It is your 401K and, legally, you have every right to roll it over to another location in a timely manner. Best wishes.

Re: 401k advice please

Financialgrl — Fri, 29 Jun 2018 15:22:13 GMT

@BirkiLady wrote:
@Jtdmum @Warrior2022 No, you do NOT want them to issue a check. It must be rolled over or you will have to pay taxes on the money!

If you have a broker, have him/her fax the documents to the individual at your former company. Follow up within 24 hours to make sure he/she has completed all paperwork. Ask if you could pick it up at your earliest convenience and return everything to your current employer (or wherever you plan to rollover the 401K monies). A little pressure on your former employer may help them realize this is needed immediately! Be firm, but persistant. It is your 401K and, legally, you have every right to roll it over to another location in a timely manner. Best wishes.

I agree with @BirkiLady bc I believe when you wish to rollover your 401k there is a time limit to do so. When I left a company and moved to another I had them issue a check and I took care of rolling it over bc then I knew it was being done. However, I'd not do that if I were you bc there used to be a deadline to be able to do so (see if that's still so) bc I think it was 60 days - if it's been almost 3 months, they may have already missed that deadline for you and you may have to get someone involved (someone with the power to make sure this rollover now doesn't sustain the huge tax.)

Re: 401k advice please

FrostyBabe1 — Fri, 29 Jun 2018 15:35:11 GMT

@BirkiLady wrote:
@Jtdmum @Warrior2022 No, you do NOT want them to issue a check. It must be rolled over or you will have to pay taxes on the money!

If you have a broker, have him/her fax the documents to the individual at your former company. Follow up within 24 hours to make sure he/she has completed all paperwork. Ask if you could pick it up at your earliest convenience and return everything to your current employer (or wherever you plan to rollover the 401K monies). A little pressure on your former employer may help them realize this is needed immediately! Be firm, but persistant. It is your 401K and, legally, you have every right to roll it over to another location in a timely manner. Best wishes.

Yes, they most certainly can issue a check. It's made out to whichever investment company you're sending the funds to, and noted "FBO Susie Smith". That's how I handled my own rollovers personally, and how we handled them for clients when I worked in investment management. IF the plan sponsor errs and makes the check out to the individual rather than the investment company, they have 60 days to deposit it to the rollover account without incurring penalties. Even then, the taxes and penalties can be waved if it can be shown that it was done in error.

https://www.irs.gov/retirement-plans/plan-participant-employee/rollovers-of-retirement-plan-and-ira-distributions

To the OP, I wish you the best in getting your 401K funds moved to wheverever you want them to be, but please, get your financial advisor involved to help you out with this rather than asking strangers on a message board. You need the RIGHT answers.

Re: 401k advice please

Allegheny — Fri, 29 Jun 2018 15:44:09 GMT

@Warrior2022

Go on Google and find the phone number of your regional office of the US Department of Labor's Employee Benefits Security Administration. Call and ask to speak to a Benefits Advisor. They should be able to give you correct information on how to proceed or perhaps may be able to intercede for you.

Re: 401k advice please

Diva on The Q — Fri, 29 Jun 2018 15:48:47 GMT

An impromptu visit with your former employer may be in order at this point.

Re: 401k advice please

BLH — Fri, 29 Jun 2018 18:12:59 GMT

You don't have to roll it over. You can just leave it there if you want.

Re: 401k advice please

Regal Bee — Fri, 29 Jun 2018 19:27:24 GMT

Having a financial adviser is worth its weight in gold. Highly advise this.

Re: 401k advice please

Highlands72 — Fri, 29 Jun 2018 22:34:22 GMT

@FrostyBabe1 wrote:

@Warrior2022

Yes, they most certainly can issue a check. It's made out to whichever investment company you're sending the funds to, and noted "FBO Susie Smith". That's how I handled my own rollovers personally, and how we handled them for clients when I worked in investment management. IF the plan sponsor errs and makes the check out to the individual rather than the investment company, they have 60 days to deposit it to the rollover account without incurring penalties. Even then, the taxes and penalties can be waved if it can be shown that it was done in error.
https://www.irs.gov/retirement-plans/plan-participant-employee/rollovers-of-retirement-plan-and-ira-distributions
To the OP, I wish you the best in getting your 401K funds moved to wheverever you want them to be, but please, get your financial advisor involved to help you out with this rather than asking strangers on a message board. You need the RIGHT answers.
. . .

The above information is correct.

Assuming that you have a current 401K plan that is willing to accept the funds, this type of FBO (for the benefit of) check issued to the administrator of your current plan in your name is characterized as a "direct transfer," with conditions slightly different to a traditional IRA rollover. The FBO check can be sent directly from the releasing institution to the receiving institution or it can be sent to you if you prefer.

It does seem to be taking an unusually long time, but no need to panic if you are satisfied that your previous employer has a reputable plan and you are receiving statements or other documentation of how your vested funds are being handled.

The plan administrator (financial institution/investment firm) of your previous employer's plan is the one to contact as opposed to the human resources department or other representative of that employer.

Re: 401k advice please

Jtdmum — Sat, 30 Jun 2018 00:02:56 GMT

@BirkiLady wrote:
@Jtdmum @Warrior2022 No, you do NOT want them to issue a check. It must be rolled over or you will have to pay taxes on the money!

If you have a broker, have him/her fax the documents to the individual at your former company. Follow up within 24 hours to make sure he/she has completed all paperwork. Ask if you could pick it up at your earliest convenience and return everything to your current employer (or wherever you plan to rollover the 401K monies). A little pressure on your former employer may help them realize this is needed immediately! Be firm, but persistant. It is your 401K and, legally, you have every right to roll it over to another location in a timely manner. Best wishes.

Birki lady- having the check issued IS rolling it into your new fund. I may have the way the check is issued mixed, it may be to the company ie. Fidelity fund fbo jane doe. vs. jane doe fbo but the check will pass to you prior to your new company. The financial company you do business with should be able to direct you and give exact wording for the check. At no time do you cash the check yourself, it passes to the retirement venue you are going to be using.

Re: 401k advice please

Warrior2022 — Sat, 30 Jun 2018 01:50:04 GMT

Thanks everyone.

I reached out to Fidelity again today. They have sent notifications to my employer twice and did again today.

So I called former employer and now I know why people are quitting left and right.

I gave her my name and said, "I have not worked for company since April 1st and I need you to let Fidelity know I no longer work there."

She said "Why is Fidelity contacting you?" I almost lost my mind.

I just repeated myself and she said she would open a ticket, whatever that means.

Re: 401k advice please

CelticCrafter — Sat, 30 Jun 2018 09:49:04 GMT

@Warrior2022 wrote:
Thanks everyone.

I reached out to Fidelity again today. They have sent notifications to my employer twice and did again today.

So I called former employer and now I know why people are quitting left and right.

I gave her my name and said, "I have not worked for company since April 1st and I need you to let Fidelity know I no longer work there."

She said "Why is Fidelity contacting you?" I almost lost my mind.

I just repeated myself and she said she would open a ticket, whatever that means.

That would not have been an acceptable answer for me. It seems like it was a brush off, something said to appease you in the hopes that you would say okay and hang up.

Re: 401k advice please

151949 — Sat, 30 Jun 2018 12:41:27 GMT

@OKPrincess wrote:
Our financial advisor called and made the transfer for me.

When my DH retired this is how we did too.

Re: 401k advice please

VaBelle35 — Sat, 30 Jun 2018 13:07:12 GMT

My company uses Fidelity as their third party administrator for our 401k.

Fidelity uses a ticketing system. This is preferable to just an email or other type of message because once the ticket goes into the system, it is tracked.

An email would go into a black hole.

My company's HR personnel will submit a ticket with Fidelity to research whatever needs to be researched.

Depending on how large your company is, Fidelity either receives the information of your separation through an electronic feed or by some sort of paper form sent by email or fax or US Mail.

Fidelity will research and either find the communication that shows you separated or ask the company/HR to re-send the information so that they can manually update your account so that you can process the roll over.

Re Rollovers

I personally would look at your new company's 401k and see what the fees are as well as the fun choices before rolling. You may want to move the money into a personal IRA, not tied to an employer, with less fees and better funds.

Re: 401k advice please

CelticCrafter — Sat, 30 Jun 2018 14:00:15 GMT

@VaBelle35 - but Fidelity is telling the OP they haven't had any communication from the ex-employer so the ex-employer opening a ticket with Fidelity is just a waste of time.