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More than 20% of 401(k) accounts are forgotten when changing jobs
Did you know more than 20% of 401(k) accounts are forgotten when employees leave their jobs? It's $1.35 trillion and your money may not be growing the way you think. FOX 26 Consumer Reporter Heather Sullivan shares some Smart Sense on how to find lost 401(k)'s.
Houston - More than 20% of 401(k) accounts are forgotten when employees leave their jobs, according to the rollover platform, Capitalize. That's $1.35 trillion in 25 million accounts.
RELATED: Nearly half of workers don't have a 401(k): Here's how you can start saving
While you may think your forgotten money has been growing all this time, sometimes former employees are charged higher maintenance fees than current employees.
"Maybe you left an old job, and you forgot to bring it with you," said Alana Benson with Nerdwallet.
And if the money in the fund is under $5,000, the plan administrator can move it to an Individual Retirement Account, or IRA, which could also have fees.
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Secure 2.0 Act: Changes to your retirement savings
The $1.7 trillion federal spending bill, Secure 2.0 Act, passed before Christmas includes 90 changes to retirement savings that are aimed at helping you to be better prepared for retirement. FOX Consumer Reporter Heather Sullivan speaks to Robert Gilliland, managing director and senior wealth advisor with Concenture Wealth Management, about what people can expect to change.
If the sum is under $1,000, they may have also cashed it out and sent a check to your last known address, and you may owe taxes on the distribution.
So let's find it: start by contacting your former employer or plan administrator. That's the investment firm that sent you the statements. No luck? There are sites you can search.
"There are several databases for unclaimed property you can search with your social security number to find those things. One is called the National Registry of Unclaimed Retirement Benefits," explained Benson.
You can also search the U.S. Department of Labor's abandoned plan database.
If it's a lost pension, check the Pension Guaranty Corp database of unclaimed pensions. And you can check on the site www.FreeErisa.com.
"That’s an employee benefits data resource, and it also maintains a rundown of employee benefits paperwork. Users can sign up for free, but you might have to pay for advanced search tools," said Benson.
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Another place to check is your state's unclaimed property database. In Texas, it's Claimittexas.gov.
A site called MissingMoney.com lets you search multiple states.
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Once you find an old 401k, you can leave it in the same account, but you can't add any money to it.
You may want to do a 401(k) rollover to your current employer's plan, or to an IRA, which won't trigger any taxes.
"There are a lot of funds out there with fees that are quite a bit lower. You may want to look into your options there," said Benson.