Employees who have invested a significant portion of their retirement funds in their employer’s stock or who have received matching contributions in company stock may experience losses in the event of bankruptcy, according to Mr. Stein of the Pension Rights Center. Although employees generally have the option to diversify their investments, they often choose not to do so due to their familiarity with their employer, which can lead to overconfidence in the stock.
Anna-Marie Tabor, a visiting professor at the University of Massachusetts School of Law, emphasizes the importance of updating contact information with the retirement plan during times of company turmoil. Staying informed is crucial, and individuals should take action if necessary. Even after leaving a job and leaving a 401(k) behind, employees should continue to update their contact information. If they do not receive updates from the plan for an extended period, it is advisable to contact the plan to understand the situation.
Where can I get help if I have concerns?
If you are facing difficulties obtaining information about your retirement plan or suspect that contributions have not been properly deposited in your account, you can reach out to the Employee Benefits Security Administration, which is a part of the Department of Labor. Their contact details can be found on this fact sheet or at askebsa.dol.gov and 1-866-444-3272. This is the recommendation made by the Labor Department to former Bed Bath & Beyond employees.
Legal assistance can be expensive, especially if the amount of money at stake is not significant. Non-profit organizations like the Pension Rights Center and the Pension Action Center may offer free legal advice or referrals to individuals concerned about accessing their retirement plans.
Where can I find official information about my 401(k) plan?
If you do not already have a copy, you can request a summary plan description from your company. This document explains the specifics of your retirement plan, such as vesting schedules and contact information. Maria C. O’Brien, a professor at Boston University School of Law, specializing in employee benefits and insurance law, suggests contacting the Department of Labor, as they may have copies of the document.
Employees should also carefully read the prospectus or disclosure for any investment option they plan to use, advises Ms. Costa. However, even if individuals request these documents, she warns that they can be challenging to understand. Terms like “guaranteed” in the name of an investment may imply no risk, but guarantees are often subject to conditions, such as specified holding periods.
