Have YOU forgotten about an old 401(K) account? Experts say $1.65 TRILLION is lying in lost retirement plans

• The average balance in a forgotten 401(K) has increased to $56,616, experts have warned
• A period of increased job switching during ‘The Great Resignation’ has led to a surge in lost accounts 
• Savers are at risk of potentially missing out on hundreds of thousands of dollars in later life 

Americans are missing out on $1.65 trillion which is lying in forgotten and lost retirement accounts, experts have warned.

As of May this year, there are 29.2 million 401(K) accounts which have been left behind when workers changed jobs, according to a study by financial company Capitalize. 

This is up from 24.3 million forgotten accounts holding approximately $1.35 trillion in May 2021 – a rise of over 20 percent driven by a period of increased job switching in recent years.

Some 3.8 million and 4.4 million accounts were left behind in 2021 and 2022 respectively, according to the study, putting savers at risk of missing out on several hundreds of thousands of dollars in retirement. The average balance in a forgotten 401(K) has increased to $56,616, according to Capitalize.

Here Dailymail.com explains how workers can track down their lost funds. 

Savers should start by seeing if they have any old plan statements from former jobs, which would indicate who to get in touch with to access an old account.

If you do not have any statements, the next best option is to get in touch with any former employers directly, according to advice from Bankrate.

By providing your personal information, such as your name and Social Security number, they should be able to look up whether you participated in the 401(k) plan during your employment and point you in the right direction to access it if you did. 

Another option is to search for plan information through the Department of Labor’s website.

By locating the company’s Form 5500, an annual report required to be filed for employee benefit plans, you should be able to find out who the plan’s administrator was during your employment – and any contact information. 

Bankrate also recommends searching for lost accounts through FreeERISA. The site allows you to search by zip code to find employee benefit and retirement plan filings by location, and find 5500 forms – and it is free to register. 

If you are still struggling to find old plans, you could try searching the National Registry of Unclaimed Retirement Benefits. By entering your social security number you can see if there are any unclaimed funds that belong to you held in an ex-employer’s plan. 

You can also check the National Association of Unclaimed Property Administrators database.  

This is not limited to retirement assets but will show if there is any money you are owed in any state where you have ever lived or worked. Over $3 billion in unclaimed assets was paid out in last year, according to the authority. 

It is crucial to track down any plans you may have lost or forgotten, Americans across the board are facing a retirement crisis, with too few households saving enough to see them through their twilight years. 

A report from Fidelity Investments earlier this year found a meagre 29 percent of people are on track to cover all of their expenses in retirement, down from 38 percent in 2020.

And recently one financial planner warned that Americans were too often cashing in on their 401(K)s when they changed jobs. 

Andrew Latham, a content director at financial services site Super Money, told Dailymail.com: ‘Regrettably, ‘job-changing cash-ins’ are not uncommon, and it’s a financially harmful trend.

‘While it provides immediate cash, the long-term cost is far greater – not just due to penalties and taxes, but also the lost opportunity of compounded growth.’

David John, Senior Policy Advisor at AARP told NBC 5: ‘When you get close to retirement, it’s an awful lot easier to figure out how you’re going to use your money if you only have a few accounts or maybe one account.’

If you are successful in finding any old workplace retirement plans, it is worth considering rolling over the accounts into your current employer’s 401(K) plan or into an IRA so all your plans are in one place.