Timeframe for 401K distribution

[ScottKar]

I live in New York City.

I resigned from my employer, a small recruiting firm in NYC, in mid December 2006. I immediately requested my 401K funds (about $30K) to be lump-sum distributed to me so I could add it to my existing IRA account. My company said they were in the process of switching from Wachovia Securities which held the company's 401K assets and to please wait.

I was just informed that they are cutting the distribution check today (May 16, 2007). It has been 5 months since I requested the distribution. I feel that this has taken way too long. Do I have grounds for legal action? I lost investment gains (my IRA assets improved significantly during this timeframe) since I would have invested in the same securities already in my IRA account .

Note: My employer said that the reason for the delay was because they wanted to leave Wachovia and needed to research and retain a new firm. I know they moved all the 401K funds to Fidelity in April, 2007. I have been in contact with my former employer's 401K administrator the entire time who kept telling me of the reasons for the delay.What is the name of your state?

 

[cbg]

There is no law which specifies when a 401k distribution must be done in each and every case. The plan document for the specified plan will determine how long the employer may take. It can be up to a year and still be legal if so specified.

In my experience three weeks is an absolute minimum even if the employer drops everything in order to take care of your 401k.

 

[ScottKar]

Thank you

I very much appreciate your reply!!