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Managing Employee Exits

A Focus on Retirement Assets

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Let's talk about Managing employee exits, and focus on retirement assets.

Plan sponsors might wonder why ex-employees retain their assets within the company's 401k plan. Here's why: neither the Department of Labor nor ERISA law sets restrictions on how long ex-employees can keep their assets within a plan. Furthermore, an individual has the right to maintain their assets in the plan, given they believe it best protects their funds.

What can plan sponsors do if they'd prefer ex-employees to transfer their assets? Establish a procedure, reminding ex-employees they have the option to transfer their assets. Starting these reminders as soon as an employee departs boosts the chance of asset transfer. Firms that utilize exit interviews to recommend asset transfers often achieve better results.

For more information on keeping your plan compliant, contact us today.

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