Many Americans are worried about their retirement prospects. You might even be one of them. But could you have more money than you think saved for retirement? According to a 2021 report from Capitalize, there are more than 24 million “forgotten” 401(k) accounts. That’s more than $1.35 trillion in assets waiting to be claimed. If you think you might have one of those forgotten 401(k) accounts, here’s what you need to know about how to find a lost retirement account and reclaim your nest egg.
How to Find a Lost 401(K)
First, check your own records for information about your 401(k) plan. You might have information in an old file that can provide you with contact information for the plan administrator. This can include old account statements, annual reports, or other paperwork. These papers usually include your account number, which can be helpful as you contact a plan administrator to find a lost retirement account.
If you don’t have old 401(k) account statements, check with your former employer for information about how to access your retirement savings. The human resources department is a good place to start. They might be able to provide you with the account number and the current custodian.
It’s not always that easy, though. Your old employer might have filed for bankruptcy or had some other issue. In that case, your money should still be safe since retirement assets are protected from bankruptcy. There’s a good chance your retirement savings are still at the investment company that served as plan administrator. Call that company and ask about the account. You might need your Social Security number to verify your identity, especially if you don’t have the account number.
Check with your state if you still aren’t sure where your money is. Some employers, plan custodians, and others turn retirement account assets over to the state when it goes unclaimed for too long. Have your personal information ready and check with your state to see if there’s money waiting for you. Depending on the state, you might need to call and ask for the unclaimed property department, or you can find the information online. The website of the National Association of Unclaimed Property Administrators offers a searchable database by state.
Finally, there is a national registry of unclaimed retirement benefits. Answer a few questions to see whether you have lost money and where you can find it.
What to Do After you Find a Lost 401(K)
Once you locate your money, you must decide what to do next. Here are some of your options:
- Leave it with your old employer. If you know where the money is, you can leave it. However, you won’t have as much control over the money, and the fees might be higher. Additionally, you might not pay attention, and your overall asset allocation might not be appropriate.
- Roll it into your current 401(k) plan. If you’re still working and have a retirement plan with your current employer, it’s possible to roll your money into your current plan. Check with your current employer to ensure that they allow for rollovers.
- Move it into an IRA. Another possibility is to roll it all into an IRA. You have more control over your money, and it’s easier to manage when it’s all in one place.
Consider speaking with a financial advisor about your choices. In some cases, if you’re already in retirement, you can take distributions from your old retirement accounts. If it makes sense for your tax situation and the account balance isn’t too high, taking the money as a distribution can be one way to deal with the account. Once you withdraw the money, you can close the old account.
Figure out what works best for you and what asset allocation makes sense for your strategy and goals after you have access to this portion of your nest egg again.
What About a Lost Pension?
If you’re eligible to receive pension benefits and haven’t been receiving them, you need to reach out to the benefits administrator. They will need your contact information and address so they can begin issuing payments to you. However, you might still need to provide proof of your eligibility. You might need old W-2 forms to show your history.
If you don’t have access to old W-2 forms, you can get your earnings statement from the Social Security Administration. Use Form SSA-7050 to ask for a statement. You can then turn the statement over to the benefits administrator to show that you are entitled to pension payments. Once all the paperwork is completed, you should begin receiving your regular benefits.
If the employer that offered the pension has ceased operating, you can also use the Pension Benefit Guaranty Corporation to search. The federal government guarantees these pensions, even if the original employer is no longer in business.
Bottom Line
When you change jobs, you might not remember to bring your 401(k) with you. If you think you might have money in an unclaimed account, take steps to find a lost retirement account and add those assets to your retirement portfolio. Your future self will thank you.
Seniority is published by Finance of America Reverse LLC. The views expressed in this publication are those of the author alone and do not necessarily reflect the views and opinions of Finance of America Companies. This article is intended for general informational and educational purposes only and should not be construed as financial or tax advice. For more information about whether a reverse mortgage may be right for you, you should consult an independent financial advisor. For tax advice, please consult a tax professional.
