‘Forgotten’ 401(k) Account Fees Can Cost Workers Thousands in Lost Retirement Savings, Report Finds
With more Americans job hopping in the wake of the Great Resignation, the risk of ‘forgetting’ a 401(k) plan with a previous company has jumped, recent studies reveal.
Former employees who don’t transfer their 401(k) accounts could incur additional fees, potentially leading to significant losses in retirement savings, as highlighted by Romi Savova, CEO of PensionBee, an online retirement provider.
What to Do with Your Old 401(k)
When individuals change jobs, they have the option to transfer their funds to a new employer-sponsored plan or roll over their old 401(k) into an individual retirement account (IRA). Partnering with Retirement Clearinghouse, PensionBee facilitates the automatic transfer of small-balance 401(k) accounts, ensuring seamless consolidation and maintenance of retirement savings.
How to Find a Forgotten 401(k)
Leaving retirement savings in a previous employer’s plan may seem convenient, but the risk of losing track of these accounts is a growing concern. By leveraging auto portability services, employees with balances up to $7,000 can have their savings moved to a new employer’s retirement account upon changing jobs, reducing the likelihood of account abandonment.
It’s crucial to manage and safeguard retirement savings during job transitions to avoid unnecessary fees and ensure long-term financial security.
