Can a company hold your pension fund?

[Rizon]

At the last two jobs I had simple IRA's. The company deposited a certain percentage of my wages into my account (not withdrawn from my paychecks).

I left the first job in 2000, and I had about $2500 in my account. I received quarterly reports on my account ever since. I requested rollerover forms but recieved no reply.

I left the second job in 2004, on bad terms (I left for a competetor). I had about $13,000 in that account and received quarterly reports also. I requested rollover forms for that company and was told they'd send them, but they haven't.

I also noticed I received NO quarterly reports for either account for last year. I know, pretty fucking stupid for me to just notice it.

So can a company take back my pension funds? And if so, wouldn't they have to notify me? I've contacted both companies again and waiting for a response, but I doubt I'll get one. Is there anything else to I can do? I want my fucking money.

[Glengoyne]

No they can't. There might be some of their matching funds that they won't have to pony up, nor possibly the interest earned on that matching portion while it was in your account. But they do have to let you move it, or at least cut you a check.

[bob]

I suppose it is possible that there was some sort of rule regarding vesting of your funds - for example, you might need to work there x number of years before the money is truly yours. Your best bet is to keep bugging the companies in question regarding the funds.

[Glengoyne]

Oh these weren't matching funds? None of it came from your check?


If that is the case there might have been vesting language.

I've never heard of a company doing that before.

[albionmoonlight]

The Department of Labor has one of the best run and most useful government web sites out there. Start looking there.

Also, it was probably a 401(k) plan, not an IRA you had, since IRAs are not run through your company.

http://www.dol.gov/dol/topic/retirement/index.htm

[digamma]

Originally Posted by bob

I suppose it is possible that there was some sort of rule regarding vesting of your funds - for example, you might need to work there x number of years before the money is truly yours. Your best bet is to keep bugging the companies in question regarding the funds.

Bingo. If you still have them, you need to review your plan documents to see if there are vesting provisions. Also, make sure you are talking to the right people at your former companies--Benefits or HR. You may also want to try to get in touch with the plan administrator (Mellon, PFPC or State Street, for example) for the company's 401(k) plan.

[Rizon]

It's a weird situation. Both companies are very small companies (4 employees, 15 employees) so neither has an HR department.

Rollover requests were mailed for employees who worked there less years than I did and were no longer employeed for longer than I have been.

And BOTH companies switched pension funds recently (I learned from birds), so now I have no idea where my money is. I could kick my own fucking ass for not doing this sooner.

Also, the pension fund companies won't let you contact them directly for service, you have to go through the company you worked for (which is ass and bizarre).

I do have all my documentation in my downstairs closet, which would take me approx. 15 days to get to through all my wife's junk.

[clintl]

You have the right to leave it in their plan as long as you want, and they have to allow you to roll it over whenever you want. It's not their money. digamma is right, you might not be contacting the right people, but at the very least, the companies should be able to tell you exactly who you do need to contact.

[Craptacular]

We have SIMPLE IRAs at work (I also work for a small company), although we contribute money that's deducted from our checks, and the company matches it 100% up to 3% of our pay. It sounds like your old companies chose to use the nonelective deferral option, in which they simply deposit a certain percentage of every employee's wages into accounts, whether or not the employee makes any contributions his/herself. Any money that is put in your account (whether you did it or they did it with a match) is YOUR money. You own it and you control it. They can change their contributions and the financial institution that maintains the accounts, but I don't believe they have any right to freeze your rights to the money.

[Arctus]

If your investiment was going towards privately held company stock (as opposed to a mutual fund or something similar), the company does have the right to hold on to your contributions after your departure (my company holds company stock investments for 5 years after departure). They would have to disclose this to you annually I believe, and you should continue getting statements as long as they have been holding on to your money.

[Loren]

well i know northwest is holding onto a bunch of those mechanics they "fired but didnt really fire" a while back's pensions..soo im thinking there are loopholes that will allow a company to do so, bastards

[Craptacular]

Originally Posted by Arctus

If your investiment was going towards privately held company stock (as opposed to a mutual fund or something similar), the company does have the right to hold on to your contributions after your departure (my company holds company stock investments for 5 years after departure). They would have to disclose this to you annually I believe, and you should continue getting statements as long as they have been holding on to your money.

I'm not so sure about this, if we are indeed talking about a true SIMPLE IRA.

From the IRS website:
May amounts held in a SIMPLE IRA be withdrawn at any time? Yes. An employer may not require an employee to retain any portion of the contributions in his or her SIMPLE IRA or otherwise impose any withdrawal restrictions.

[Craptacular]

Originally Posted by Loren

well i know northwest is holding onto a bunch of those mechanics they "fired but didnt really fire" a while back's pensions..soo im thinking there are loopholes that will allow a company to do so, bastards

The rules for traditional 401(k)s, pension plans, etc, vary widely. However, the SIMPLE IRA was specifically created for small companies to be able to provide retirement plans to their employees without haivng to go through all the hoops of the other plans.

[ISiddiqui]

I don't understand... Simple IRAs are in your name. They are your account. 401k's require rollovers, but Simple IRAs can be rolled over (or taken out) by just contacting the administrator.

Maybe the companies were like "WTF? Rollover forms?" or they were really 401k plans.

[ISiddiqui]

Oh, btw, for Simple IRA's there are no vesting requirements. The money goes directly into an account in your name (and not in the name of the company). The company has absolutely no control after that. So if there was a vesting requirement for Simple IRAs, the company would have to ask you to give that money back... which would never happen.

[BuffaloHuskey]

If it is indeed a Simple IRA, that money is yours, and they have no right to withhold it from you. If you have exausted all contacts at the company, you should contact the Department of Labor and report this. A letter from the DOL will get their asses moving.

[Cringer]

Originally Posted by bob

I suppose it is possible that there was some sort of rule regarding vesting of your funds - for example, you might need to work there x number of years before the money is truly yours. Your best bet is to keep bugging the companies in question regarding the funds.

I know my pension plan works like this. They add money to it (not matching, I don't put anything in). But I had to work there 5 years before I was actually fully in the pension plan (I could quit and still have it later on).

But if it's a SImple IRA I don't know anything about that.

[CraigSca]

How come you can't contact the holding company? I have two previous 401(k)/IRAs, they're both with Fidelity, in my name, and I can see the money in them at any time.

[ISiddiqui]

Originally Posted by BuffaloHuskey

If it is indeed a Simple IRA, that money is yours, and they have no right to withhold it from you. If you have exausted all contacts at the company, you should contact the Department of Labor and report this. A letter from the DOL will get their asses moving.

Don't do that. They'll simply tell you that if it is a Simple IRA, the company isn't in charge anymore. The account is in your name and you can get the money out at any time by asking the investment company. The way Simple IRAs work is that the account is always yours. It is never under the company name. Therefore, you can get it at any time. That's why the reporting requirements are far less on Simple IRA plans (yes, I work for the DOL). That is why I think it isn't a Simple IRA, but rather a 401k.

If its a 401k, first read your plan documents, THEN call the DOL. 401k rollovers require the signature of the plan administrator. Simple IRAs don't.

[bbor]

Sounds like those companies want their staplers back that you took.

[Rizon]

Originally Posted by bbor

Sounds like those companies want their staplers back that you took.

I did actually take staplers.

Spies.

[Rizon]

I tried a few more times to get my damn money:

The company I had the smaller amount of money sent me rollover forms (it was a 401k plan, and the request has to go through my previous employer).

It took a few times for my other past employer to get a response. They are in the process of changing plans, but I'm still the "custodian" of that plan, so they can't make any changes until I sign off (hahaha). They said they'd have someone from the plan services call me to tell me how to rollover. It's very clear my ex-employer has no idea what forms to send me, or what they've even supposed to do. This was a week ago, and of course I have not received a call back. But at least I have the guys name and can call him.

[Rizon]

Update:

For one company, I've already filled out rollover papers twice since. Haven't seen a check yet.

For the other company where I had the most money in, turns out I was vested 0%. Nice of them to get back to me on that. I pulled all the pension papers between 2000-2004, and at one point I was vested 40%, a few months later, 0%. The plan had changed around 02 or 03. I always thought the % you had vested would never change. Plus I have a hard time believing that I was vested 0% after working there 4 1/2 yrs, yet was vested 50% at the previous company for being there 3. I can't get anyone to answer any questions I have about it. Where does my money go now? Back to my ex-employer?

I don't think I will ever participate in an employer pension/401k plan again. I'll just take the higher check and invest it myself. Luckily the job I'm at now has individual plans that the employer can't touch.