Author Topic: Change to 401k match from monthly to annually  (Read 2781 times)

Jules13

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Change to 401k match from monthly to annually
« on: December 21, 2017, 09:41:24 AM »
So, my husband's employer just announced this ass-hole change in order to promote "loyalty and longevity".  If you are still employed on Dec 31, they will deposit your 'earned' match in the first quarter of the following year.  No other change other than ONLY giving you the match if you are employed at the end of the year and have 1000 hours accrued.

Has anyone else had this change happen at their employer?

So, I'm guessing that instead of including this amount in any of our savings projections, I just need to think of it as 'bonus' money at the end of the year IF my husband doesn't decide to switch jobs that year?

Thanks.


Outside the Box

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Re: Change to 401k match from monthly to annually
« Reply #1 on: December 21, 2017, 10:08:30 AM »
Mine has always been semi-annual. I find it annoying. This would be more annoying.

In my opinion, it's arbitrage with your money, but it also, especially, in your case, allows them not to pay it out if you leave.

tooqk4u22

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Re: Change to 401k match from monthly to annually
« Reply #2 on: December 21, 2017, 10:09:21 AM »
My company does that - and it is a large company.  It sucks and this is the only company experienced this with, been here about two years, every other company was put in with each pay period. 

.... in order to promote "loyalty and longevity".....

This part is obviously 100% BS.  First nobody is staying many months more than desired just to get a 401k match and if they do it is likely tied to other bonus compensation that they will get.  Its just some beancounters did the math that said we experience x% attrition every year and it will save us x $.  All about the bottom line but they can still say we didn't cut your benefits. 

EricEng

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Re: Change to 401k match from monthly to annually
« Reply #3 on: December 21, 2017, 10:19:57 AM »
I briefly worked for a company where they waited until you had been with the company for at least three before any match was deposited and even then it was only annual at the end of the year.  Terrible system.  Incidentally they had horrible turn over because the company did this kind of thing everywhere.

inline five

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Re: Change to 401k match from monthly to annually
« Reply #4 on: December 21, 2017, 10:23:30 AM »
Total BS. Nickel and diming.

StarBright

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Re: Change to 401k match from monthly to annually
« Reply #5 on: December 21, 2017, 10:29:31 AM »
My employer does their match in September for the previous year. So at the end of September 2017, I got my match for 2016.

It sucks but the alternative is no match at all.

ketchup

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Re: Change to 401k match from monthly to annually
« Reply #6 on: December 21, 2017, 10:52:46 AM »
My employer does their match in September for the previous year. So at the end of September 2017, I got my match for 2016.

It sucks but the alternative is no match at all.
Mine is similar to this, but it's usually around May.  I'll take it.  Monthly would be nice but it's not the end of the world, still free money.

alexpkeaton

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Re: Change to 401k match from monthly to annually
« Reply #7 on: December 21, 2017, 11:08:33 AM »
Yeah that's garbage. It probably makes it a little easier for them since they don't have to deal with true-ups. But that's not your problem.

My current employer matches 5% on any contribution, including after-tax contributions. They don't do a trup-up, but it's no big deal since once I hit the $18k limit I can still keep contributing with after-tax dollars. (Matching contributions are always into the pre-tax segment of the account.)

RocketSurgeon

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Re: Change to 401k match from monthly to annually
« Reply #8 on: December 21, 2017, 11:28:36 AM »
My employer does their match in September for the previous year. So at the end of September 2017, I got my match for 2016.

It sucks but the alternative is no match at all.
Mine is similar to this, but it's usually around May.  I'll take it.  Monthly would be nice but it's not the end of the world, still free money.

Is it? Because it sounds like it's a part of the compensation package that was agreed upon when you were hired. Which would make it not free, but something you worked for.

Jules13

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Re: Change to 401k match from monthly to annually
« Reply #9 on: December 21, 2017, 11:30:01 AM »
Yeah, I think the ' rewarding longevity and loyalty' pisses me off the most.  It's like a backhanded compliment.  My husband has worked there for 15 years and this is hardly a reward.  A reward would be something extra, not all of sudden taking what they are already giving you and deciding to use it as a carrot instead.

Guess I will just discount it for now and chalk it up to a bonus each year if he gets it.  It's total bullshit though. 

And what's even more bullshit is that not a single person is talking about it at work.  They sent out an email about it last week (not with the normal open enrollment information/changes my you) and I'm guessing the majority of employees either didn't read it or don't understand it.  Makes me crazy!!

EricEng

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Re: Change to 401k match from monthly to annually
« Reply #10 on: December 21, 2017, 03:37:34 PM »
If tenure and retention was truly their honest goal they could do this through a vesting period for the match amount.  Instead, just delaying giving you the money is straight greed on the corporation so they can hold the money in their accounts longer to let it grow and delay paying their obligations by a year.

TexasRunner

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Re: Change to 401k match from monthly to annually
« Reply #11 on: December 21, 2017, 03:44:54 PM »
Meh, depends on the % match and up to what % of pay.

Changing it on you is less of a sting if they keep those values the same, and is probably cheaper/easier on the employer to take an annual deposit number and your 1099 and do the math at once instead of continuously.

Just FYI, my company's match is shit ( (1) 5% to 15% depending on "generosity" that year, (2) paid at end of year, (3) up to 7% of your pay, (4) with a 5 year vesting schedule type of shit), but I knew that going in and worked there anyway.

I wouldn't leave over it, but you bet your ass that I'm leaving after it hits the account without giving 2-weeks.  Doing crap like that incentives disloyalty in the long run.

Nathaniel

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Re: Change to 401k match from monthly to annually
« Reply #12 on: December 21, 2017, 04:27:46 PM »
My company is moving to that next year. The people I work with are clueless about it. Some don't even contribute to at least get the match. Completely agree that this is to the company's benefit, not to "reward" the employees. On the bright side, it is easier to front load without worrying about spreading contributions throughout the year to get the full match.

 

Wow, a phone plan for fifteen bucks!