If I quit my job before my 401k match is paid out, am I still entitled to it?

Question

I'm planning on quitting my job early in 2007. I am fully vested in my employer's 401k plan and am entitled to a match of 3% of my salary for 2006. Typically, my employer deposits the full match in April of the following year (2007, in this case). If I quit before the money is deposited, am I still entitled to the match since it was fully accrued at the end of 2006? I've seen a lot of information regarding the vesting itself, but nothing in reference to the logistics around the timing of the payout.

Answer 1

I am a retirement plan consultant. You will want to ask your employer, but to be certain, ask your employer for what is called a "summary plan description". This is a legal document that your employer is required to provide to you by law. It is an easy to read document that is designed for people who are not experts to understand the provisions of your plan. 401ks can be written to have an employer contribution that is paid to employees who are employed at any time during the plan year, or they may have a restriction that states you must be employed on the last day of the plan year in order to receive the employer contribution. The only way you will know for sure is to check the Summary Plan Description. Another way to find out is to call the company that your employer has the 401k with... for example, Fidelity or Principal Financial Group. Your employer may think they know the answer to the question, but they are not always right. The 401k plan provider will be able to tell you what the situation is for certain.

Answer 2

In theory, you should be entitled to it. But that doesn't mean you get it. I've been screwed out of bonuses that were paid 3 months after the 'quarter' that they were earned, and I'd given my notice a few days before payout and not gotten it. You never know.

Answer 3

I am sure you are entitled to the company match. It should be paid until you leave but it would not include 2007.

Answer 4

It depends on what the plan document says. Some plans state that you must be employed on Dec 31st AND the date in which the employer contribution is made.

Some just state that you only need be employed on Dec 31st.

Answer 5

i think you should be paid for 2006 but will be paid nothing in 2007, contact an HR rep or if you want to be more discreet call any financial advisor and they should know.

Answer 6

Yes - they will prorate it and deposit it when you leave.