Archived what happens to 401k and pension after i leave?

Status
Not open for further replies.
Joined
Aug 30, 2011
Messages
64
so my last day was this past friday, my hr told me that at my new job, when im eligible for 401k that there will be some paperwork i can fill out and fax to target, and they will roll over my 401k to my new job, is that accurate? also ive heard from several people that after they left they received a check in the mail, a rather sizeable check, and they were both thinking it was their retirement and pension, since target no longer offers that? does anyone know what happens to the pension after we leave? thanks in advance for any help!
 
Transfer 401k from spot to Ira or new job 401k, fill out a form on targetpayandbenefits.com

Here is some good info:

The $425 that is in there is 10% of each check really...your 5 plus their match. Their match is already vested so its yours to keep. There is a 401k document on the targetpayandbenefits.com site that outlines the payout info. Savings and Retirement tab -> Plan Information Available Online -> then look at the 401k's Summary Plan Description.

Looking at that document it says less than $1,000 is paid to you automatically, $1,000 to $5,000 is automatically rolled over into an IRA they have an outside bank create (not ideal) and $5,000 they continue to hold and manage as they do now. No matter how much you have you should still be able to roll it over into another plan or IRA.

Within a month or so of your termination you'll get a letter asking you to go to the benefit site and choose your payout option otherwise the above defaults will be used. You'll still want to go on there and choose the cash payout because it might take awhile for them to automatically send it if you take no action ("the last business day of the quarter following the quarter of your termination date" according to the SPD).

It was a smooth process for me, you just have to wait a bit for it to start. I filled out the IRA rollover form on their site on a Monday and had it available in my IRA the following Monday I believe.

Summary: Do nothing and they'll mail you a check next year, or fill out a form on their benefits site and you'll get a check or rollover sooner.
 
Last edited:
Just remember that if you have the pension and the 401k, they are separate. You have to let them know what to do with each one if you don't like the default option. I remember when I left, I cashed out the 401k and got the check and thought that was it. Then I got a letter telling me that my pension was being rolled over. I wish I had known they were separate so I could have cashed out the pension as well but I've let it gain its 0.5% a year since then (or whatever the miniscule rate of interest is).
Yes, it's a tax hit but I got money back that year anyhow because I was unemployed for most of that year.
The outside bank is annoying because I moved shortly after I left Target and I have to come up with proof of address before they'll release the money to roll over to an IRA at my bank. At this point, I'll just wait and let them have a copy of the W2 I should be getting within the next month.
 
And if you're getting the payout, don't expect it to be immediate. I think my check was cut at the beginning of the second month after I quit (that is, with you leaving mid-Jan., I'd expect them to send you a check the first week of March). Apparently it takes them a few weeks to process things, and then they only do checks once a month.
 
You have up to 90 days after your last day to transfer your 401k and any pension funds to another qualified account. If you don't, it will be moved for you into an external IRA account (ex. KeyBank) for you. Or go to a local credit union.

Whatever you do...do not request a payout because you will get penalized for early withdrawal (even if you plan to re-deposit it into another qualified account). Then you will have to pay taxes on it.
 
Within 3 weeks of your termination, the 401k/Pension department sends you paperwork with all the details about your 401k and Pension options. call the TBC 800-828-5850 if you have any further questions
 
Status
Not open for further replies.
Back
Top