If you’ve ever retired from or left a job, you know how difficult it can be to get money out of your old retirement plan. All you want to do is take a distribution and roll it over into a new IRA, but that ends up being a lot more work than you anticipated. We have dealt with this process for clients of Mullooly Asset Management before, and it can be frustrating. These pending cases sometimes take months to resolve, and that is not acceptable. Investors are entitled to this money that they contributed to the plan, and they shouldn’t have to wait to receive it when they leave a job. Tom and Brendan discuss how to get money out of your old retirement plan when you leave a job in this week’s Mullooly Asset Management podcast. We’ve previously spoken about this topic in another podcast that you can find here.
In most instances if you work at a larger company, your retirement plan will be held at an online discount brokerage firm. When online discount brokerage firms are used the money will be much easier to obtain. Discount brokerage firms have dedicated service teams that are often available 24/7. We have seen distributions require just a phone call and a few days waiting for the check in the mail. This is how the process of getting your money out of an old retirement plan should go.
Most of the problems arise when investors have a retirement plan that isn’t at a discount brokerage firm. A lot of smaller companies have smaller retirement plans hosted at a variety of places. Often when somebody wants to take a distribution from a smaller plan, the administrator (often the small business owner) has to sign off on any moves or changes. Tom and Brendan have also seen a lot of “lost” paperwork, filing mistakes, and other mishaps when it comes to the broker or firm in charge of the old retirement plan. They like to drag their feet and make the distribution more difficult than it has to be. We have dealt with, and are currently dealing with, situations of this type at Mullooly Asset Management. It’s a real shame to see what should be a simple process become difficult.
The thing to keep in mind if you are going through a situation like this is that it is your money. You are entitled to that money, and you will get it eventually. Sometimes a little persistence and perseverance is needed, especially if you are doing this on your own. We’ve actually found that a conference call that includes us, the client, and the broker or advisor who has the old retirement plan tends to clear things up. It’s not fun to be antagonistic or confrontational, but sometimes that is what gets the job done.