Guarding your 401(k) and other retirement money requires attention to details on your account statements and in the wider economy. Watch for missteps by your boss, and by the government.
Missing money. Credit.com says payroll deductions for a 401(k) should show up quickly in your retirement account statement. If they don’t, get ready for a fight. “Retirement plan fraud is more common than you might think,” says this post by financial planner Matthew Illian. Be alert for missing or late contributions, retirement fund deposits that don’t add up to the payroll deductions, and odd investments by the fund’s managers. Any of these should be taken as red flags. tinyurl.com/Retire401tips
Protection. The Federal Reserve has put off its inevitable “tapering,” when the central bank will slow its big stimulus program of bond purchases that was meant to keep interest rates low. When that stimulus eventually is scaled back, what are the implications for your own retirement investments? In this video from the TV station WTVR in Richmond, Va., Sandy Wiggins of the Actuarial Consulting Group says to get ready by holding “a broadly diversified portfolio” that includes short-term bonds and long-term stock holdings. And, he says, anticipate “a bumpy ride.” tinyurl.com/RetireMarket
Warning signs. Other signs of trouble with your 401(k) plan may include unexplained changes in investment managers or consultants, account-balance declines that don’t track with normal market fluctuations, and severe financial difficulties experienced by your employer, according to this list from the Department of Labor. tinyurl.com/Retire401RedFlags
Consumer assistance. If you think there’s a problem with the retirement or health plan provided by your employer, visit this page at the Labor Department’s Employee Benefits Security Administration. The agency says that last year, through its informal negotiation process, it recovered $260.6 million in benefits “improperly denied” to individuals. Tougher cases referred to its “enforcement staff” netted an additional $50.2 million, EBSA says. tinyurl.com/RetireAssist
Complain. Here is a link for filing a complaint with the EBSA: tinyurl.com/RetireComplain
Boss guidance. For employers, the IRS has this outline of basic instructions on how to start and run a 401(k) program, with details on who qualifies and your fiduciary responsibilities in overseeing a retirement plan. Being a fiduciary means the decisions you make regarding worker’s retirement funds have to be made in the workers’ interests – not in the interests of your business. tinyurl.com/RetireBoss