401 k

[wendymariereed]

What is the name of your state (only U.S. law)? Michigan

I was let go by my company 4 weeks ago. I have a 401k, my house is in pre-forclosure and I need to take money out of my 401K. My ex-employer is telling me that there is no hardship when I am let go and that I need to wait 60 days to be able to get my money out. By then my house will be forclosed on. Where can I go to get help?

 

[pattytx]

Ask HR for a copy of the Summary Plan Document; they are required to give you one and request, and see what it says. What they are saying is not impossible; generally speaking, based on the plans I've seen, hardship withdrawals are limited to employees only.

The employer MUST follow the plan rules EXACTLY or risk jeopardizing the entire plan.

Once you have that, you can use it as leverage with your mortgage holder to buy yourself a little more time. Believe me, they don't want to take possession of your home unless they absolutely have to, because they'd have to market it and sell it themselves.

 

[wendymariereed]

Hi have it, it doesn't say anything about a 60 day waiting period. I called T Rowe that manages it. They say I should be able to do a hardship but XO won't allow them to do it. XO Communications won't return my phone or even assit. I only need to take a small percentage of the money not all of it. The IRS says that it falls within the rules .

 

[pattytx]

Then I'm sorry, I'm not sure. We have a benefits expert here that may be along shortly. She may have some ideas for you.

 

[cbg]

What does the SPD say about disbursals at termination? Note that I am NOT talking about hardship withdrawals - I am talking about cashouts, rollovers to IRA's and other 401k plans, etc.

 

[wendymariereed]

401k

this is what my termination packet says: In accordance with the terms of XO's 401(k) Savings and Retirement plan, you are eligible to recieve your accrued and vested benefits after your termination date. Please note that in accordance with the plan, once you terminate: XO will pay out your account balance of less than 1,000. Upon termination the employee will be notified by a letter from T. Rowe price explaining the cash payout policy. (2) Any outstanding 401(k) loan balnce is due in full. XO can instruct T. Rowe price to default any unpaid balance. Addtional information regarding distribution options for you vested 401 (k) can be obtained by contacting T. Rowe price the plan administrator.

 

[cbg]

Then your next step is to get that information. Not all plans allow for immediate distribution. Contact the plan administrator, by phone if necessary, and get a copy of the distribution rules. If you can get them to explain the options to you by phone, so much the better.

 

[wendymariereed]

I spent over 12 hours on the phone with T ROwe thye say according to the info that they have on file. I am allowed to take a withdrawl, but my ex-employer says no reagrdless of what the plan says.

 

[cbg]

Then contact the US DOL (which is the regulatory agency for 401k's) and file a complaint.