Find Missing Money in Forgotten 401(k)s

Millions of workers who changed jobs left more than a coffee mug behind. Billions of dollars in retirement assets are being held by former employers or the Pension Benefit Guaranty Corp. (PBGC), which inherits pensions from companies that have shut down their plans. Over time, workers may forget about 401(k)s and pensions or lose track of them as former employers merge, change names or close. Or their employer may itself lose track of them. The result is that retirees—and their survivors—are missing out on benefits.

Now, efforts are under way to make it easier to reunite workers with the lost money. The PBGC, which tries to find missing participants owed benefits from terminated private pensions, recently launched a similar, voluntary program for 401(k)s and other defined contribution plans.

Employers can transfer money from 401(k) accounts—starting with accounts terminated this year—to the PBGC, which will then search for the workers and pay out the benefits. Or the employer can notify the PBGC of the name of the financial institution holding the money. If the PBGC can't find the workers, they'll be added to the agency's "missing participants" database (www.pbgc.gov/wr/missing-participants), where anyone who suspects they have missing retirement money can search for unclaimed benefits.

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Bipartisan legislation introduced in the Senate in March would create an online registry for workers to locate all employer-sponsored plans. The bill would also require plans to report when account balances of less than $5,000 have been rolled into an IRA for missing employees.

Terminated plans generally must attempt to find missing participants, but workers shouldn't count on it. MetLife, which assumes pension obligations from employers that no longer want to manage them, recently admitted it didn't search hard enough for 13,500 people who were owed annuity payments going back as far as 25 years.

To avoid losing a benefit, tell your former employer whenever your address changes. Keep plan documents, tax returns and other paperwork that can help you locate a benefit. If you need help tracking down a lost pension or 401(k), contact the federal Employee Benefits Security Administration (www.askebsa.dol.gov/WebIntake/Home.aspx or 866-444-3272). Or go to www.pensionhelp.org to see if one of six programs serving 30 states can help you find a plan.