Old, forgotten 401k? We can help
More than a third of US workers changed jobs after the pandemic, according to a recent NPR/PBS NewsHour/Marist National Poll. Chances are you may be among them. If you are, you might have started a new career and haven’t quite figured out what to do with your old 401k.
You’re not alone. A 2021 study by a fintech company, Capitalize, found that there are an estimated $24.3 million in forgotten 401(k)s holdings. This is valued at approximately $1.35 trillion in assets, with another $2.8 million left behind annually. These are called “floating” 401k funds and can go on for years. Many clients we help here at Staggs Financial Services have two or more traditional or Roth IRAs that are just sitting there.
If you’re younger than 59 1/2, you may wonder why to address this now. After all, you may have decades before you can withdraw your retirement savings tax-free. So why make this a priority?
Peace of Mind
Know where your money is and how it is performing. This will give you greater peace of mind. Whether you have $10,000 or $400,000 in your previous 401k, it’s important to see how your retirement is doing. Are you on track to have that beach house or mountain home? Is your retirement looking prosperous and enjoyable? If not, what do you need to improve so you can retire the way you want to?
Remove management fees
Many clients don’t realize there are management fees on most 401k plans. If you have multiple 401k plans, then each account can have a fee - costing you money.
Your loss, whose gain?
We’re all busy. Whether you’re traveling or have a full schedule with children and your career, it can be hard to keep track of your retirement. After all, it may seem so far away. If you’ve moved and lost the paperwork, this can make your goal even harder. However, if you have multiple accounts and the inevitable happens, how will your beneficiaries know who to contact? Don’t let your investments languish away. Keep your records clear and up-to-date.