Downsized, lost pension, now what?
My department at work downsized so I was let go,I had invested in 401k matching thru employer what should I do with the money? I was told I can’t get any money from the pension plan that the company put money every month cause I didn’t fulfill 5 years of employment? Also what investment plan do you suggest for future savings and how much?
Terry Says: First, let me say how sorry I am that you lost your job. But better now than five years ago. The economy is growing and there are still jobs out there to find. It will be easier when you have the weight of this decision off your mind. You need to “roll over” your 40l(k) plan and DO NOT TAKE A CHECK!
Contact Fidelity or Vanguard (800-FIDELITY or 800-VANGUARD) and ask them to handle the rollover. They will do all the paperwork, and will suggest appropriate new funds, based on your age and financial situation. If, in the future, you get a job with a company that provides a 40l(k) plan, be sure you participate. But if you get part-time work or side jobs, then open an IRA at either of the places above and you can save up to $5,000 per year in an IRA (if you are under age 50, or $5500 if 50 or older), in funds that will make your money work for you.
And I have a nagging thought, that you might consult some experts about the loss of your pension. If it can be proved that the company specifically chose to downsize employees who were nearing reaching pension “vesting” (5 years) then there might be a lawsuit for all of you. Contact the National Center for Pension Rights at http://www.ncrb.com/ and have them look at your situation.
