Author Topic: Unvested 401k Request Inquiry  (Read 1227 times)

wscott1200

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Unvested 401k Request Inquiry
« on: April 10, 2019, 04:38:23 PM »
In 2016 I was released from my employer due to company acquisition.
At that time there was an unvested amount in my 401k.
I reached out to my employer who stated the amount would not be vested unless for some reason I
return to them as an employee and finish the vesting period. As this seems unlikley is there a request procedure or form
I can submit to my former employers plan administrator to request the release of the funds?
Ive read that in some cases a request can be submitted for the funds to be released
Its been almost three years and the amount is still there.

Ftao93

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Re: Unvested 401k Request Inquiry
« Reply #1 on: April 10, 2019, 04:48:15 PM »
I have an old one that is partially vested.  I've considered just rolling it into another account that I care about, but it's not hurting anything and it tells me the vested balance.

What difference does it really make?  Could you roll it over to a lower-cost one?


dsw

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Re: Unvested 401k Request Inquiry
« Reply #2 on: April 11, 2019, 08:02:10 AM »
My rough understanding is that in most cases, that money is just lost to you if you don't return to the company. It may show up in your account for some time before it goes away though.

The one exception I know of is if there is a significant layoff which dramatically decreases 401k participation. In those cases, your unvested amounts may become vested. It sounds like that may not be the case in your situation though.

Hopefully someone else will have some better news for you though.

therethere

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Re: Unvested 401k Request Inquiry
« Reply #3 on: April 11, 2019, 08:13:26 AM »
So you're just getting annoyed with having to look at two balances. Is that correct?

If so, the easiest way would be to just rollover your account into an IRA. Probably a good practice anyway.

I would check first that the unvested portion is in no way due to you. I actually have an old 401k that states the unvested contributions are not mine, but the gains from the unvested contributions are vested (and therefore mine). At least that's how I understand the wording. I'm keeping that account with the original provider because of this clause.

jeff191

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Re: Unvested 401k Request Inquiry
« Reply #4 on: April 11, 2019, 08:29:35 AM »
It's a standard rollover you are looking for unless you want to cash out and pay penalties. If you plan to rollover, just call the service provider of your old 401k and request the forms. Then you can roll into current 401k or IRA. If you want to cash out, same process, call the service provider.

You are only due the vested portion of the balance. Typically when someone leaves without fully vesting, they will show the entire balance even though only the vested portion is due. Then when you roll the money out, they only send the vested portion. Most administrators record it that way because it's easier to manage (I used to work in this world). If you ever go back to that company and the plan allows for reinstatement, they would put the unvested portion back into your account once you vest.

wscott1200

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Re: Unvested 401k Request Inquiry
« Reply #5 on: April 17, 2019, 11:24:45 AM »
Thanks for the replies, but the question I was asking was is there a way to formally request the unvested portion to be released to me?

Cool Friend

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Re: Unvested 401k Request Inquiry
« Reply #6 on: April 17, 2019, 11:32:09 AM »
Thanks for the replies, but the question I was asking was is there a way to formally request the unvested portion to be released to me?

AFAIK, no.  You only get that money if you complete the requirements of the unvested portion, e.g. working there for 5 years or whatever.  Otherwise you lose it.

therethere

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Re: Unvested 401k Request Inquiry
« Reply #7 on: April 17, 2019, 11:32:49 AM »
Thanks for the replies, but the question I was asking was is there a way to formally request the unvested portion to be released to me?

You're asking whether you can be given the unvested portion? No. It's not vested. It's not yours.

jeff191

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Re: Unvested 401k Request Inquiry
« Reply #8 on: April 17, 2019, 08:17:34 PM »
No. The plan has to operate by the rules written in the plan document and the vesting schedule is part of that. Sometimes when a company is acquired and employees are let go because of that, they will amend the plan to vest anyone who was impacted. I used to run the plans for a large company that did this when they bought companies and there were RIFs. But if your former plan was not amended to do this, the unvested portion does not belong to you. You didn't meet the vesting requirements - why you didn't make the vesting period doesn't matter, it's that you weren't there for the time required.

Thanks for the replies, but the question I was asking was is there a way to formally request the unvested portion to be released to me?