Comments on: 401k Vesting Question

By: MFJ

MFJ — Tue, 19 Jun 2007 11:51:17 +0000

Yeah I think you had to work there like 8 years before being fully vested.

My new employer I am 100% vested for the 4% they match and deposit with each paycheck. They also have an additional 5.5% they put in at the end of each year and that is vested after 3 years.

By: j2r

j2r — Mon, 18 Jun 2007 22:53:48 +0000

That was quite interesting… My current 401k and my previous 401k didn’t have any matching, but they were both 100% vested from the beginning.

20% after 2.5 years sounds like a lot, but again, my company doesn’t match, so I guess it turns out even somehow.

By: broknowrchlatr

broknowrchlatr — Mon, 18 Jun 2007 19:11:47 +0000

This happened at my former employer also. They had a rule that if you leave the company with x years of service, you have x years to return and not lose any unvested balance. My current company is the same. Maybe your company does something similar.

Say you have $10k in matching funds that are %20% vested and you leave after 5 years. Then $2000 can be taken out and the other $8k stays. If, after 5 years you do not return, the unvested funds disappear.

By: MFJ

MFJ — Mon, 18 Jun 2007 15:41:55 +0000

Dang I knew I was overlooking something – thanks for straightening me out…..guess I’ll continue on with the rollover after all.

By: TFB

TFB — Mon, 18 Jun 2007 15:23:51 +0000

Yeah, too good to be true. The matching money is tracked by a subaccount within your 401k by source. However much it grows, you will get 20% of it. For example let’s say this $2,300 grows to $23k, when you withdraw, you will get $4,600. If you rollover today at $460, you will grow it to $4,600 if you invest in the same funds. You are not going to gain anything real by keeping it in the 401k.