I lost my job and need the money that I have put into my 401k. My boss told me that we have a safe harbor 401k and that I have to wait until next year after taxes to get my money unless I want to pay a $125 fee. I have never received any thing about the plan except the $150 that I have taken out every pay check. Nothing showing me my balance or even the company how is handling it. All I know is that my boss is the trusty of the plan.
2007-10-11 11:55:50 · 6 answers · asked by Chris 1 in Business & Finance ➔ Personal Finance
I agree it's a weird plan. You should be getting quarterly statements of your account.
Ask for a statement of your account. You are entitled to know your account balance.
2007-10-11 12:13:55 · answer #1 · answered by bdancer222 7 · 0⤊ 0⤋
Though it sounds weird I think everything is on the up and up here.
The reason he's saying you have to wait until next year is that he has until then to contribute the Safe Harbor contribution that you are owed. If he pays you out now he'll have to pay you another distribution next year. Which is why he wants you to pay $125. He's basically saying I'll give you one distribution without paying a fee but if you force me to process it twice then you'll have to foot the bill for the second one.
The fact that your ex-boss is a trustee isn't suprising. That's the case for almost every 401k sponsored by a company that employs less than 300 people.
The not receiving any information is a bit disconcerting though but only a bit. There are some 401k companies that use the internet to provide account information and the participant (you) can print out a statement any time they want. Ask your boss where the money is invested and what the web address is so that you can check your balance.
As far as needing the money...he's telling you that you can withdraw your money for $125...it's up to you to decide how much you really need it.
But if you think you need to contact someone about this...you can always ask the DOL to look into it for you. www.dol.gov and look for retirement plans links. Though as someone who has been involved as a 401k plan consultant for 15 years I'd say it looks ok and I wouldn't go that far.
2007-10-12 03:52:11 · answer #2 · answered by digdowndeepnseattle 6 · 0⤊ 0⤋
I have worked with 401k's for many years. Although uncommon, plans can put a waiting period on when you can access your money. Typically 30 days, but I have seen some with 1 year and also have even seen them where you can take it out til age 65. Yes they can do that. When you agree to put money in the plan you agree to go by the plan rules which may have waiting periods. Have you thought about just paying the 125$ fee , if you need the money and w/d it you'll probably lose 30-40% of it to taxes and penalties, so what 125 $more.
2007-10-11 15:07:06 · answer #3 · answered by Mike 2 · 0⤊ 0⤋
You need to contact Safe Harbor directly and tell them that you would like to rollover your 401k to another plan.
Do not ask to "take the money out" of your 401k, or they will think you want to withdraw the money, cash out, etc - theis subjects you to heavy taxes and fees no matter which company you use. What you want to do is "rollover" the money into another retirement account so it stays protected from taxes. This paperwork may take a month or so for the current and new financial companies to process, but there's no reason you can't begin this immediately.
Your boss is legally required to give you information on your 401k and the company that manages it. He may be the "trustee" of it for your company, but the money is actually managed by a different company, one that specializes in financial plans.
2007-10-11 12:15:03 · answer #4 · answered by teresathegreat 7 · 0⤊ 0⤋
Find out who the 401k company is and contact them. You should be able to access your funds 30 days after termination. That's a weird plan if you can't get a hold of it for 1 year.
2007-10-11 12:09:15 · answer #5 · answered by oceanpotion™ 3 · 1⤊ 0⤋
They can make you wait for the funds, also most companies require a vesting period, often 3 to 5 years. If you leave the company prior to vesting you would loose all company matching contributions. However, if you were vested you should be able to get all of it. Taking the money and cashing out would be a huge mistake involving taxes and penalty. I would consider leaving the funds or rolling the money into a IRA.
2007-10-11 12:16:10 · answer #6 · answered by logicboy 3 · 0⤊ 0⤋