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Message
Help me out MT (401k related)
Posted on 9/8/14 at 6:29 pm
Posted on 9/8/14 at 6:29 pm
So for the past year or so my 401k contributions have taken anywhere from 5-8 business days to make it into my account. An example being my last one, got paid on August 29 and walked my retirement check over to HR and at this minute it is still not there.
I have raise hell about it before because I am out my contribution for that amount of time and I bring up the point that it is like me taking money from them when they get paid an giving it to them later. I am also one of two people who contribute and the check writer so to speak does not. I contribute $440 twice a month, if that matters.
So my question(s):
Am I overreacting and that time frame is acceptable in a digital age that we are in?
I know it works out in the long run, but a couple of times I could have taken advantage in price drops within my fund only to wait a week until my contribution went in and the price is back up.
I feel three business days is plenty. What say you?
Two side notes, first I am on mobile so forgive any spelling mistakes and secondly there was one period when I got paid twice and my first contribution still wasn't there.
I have raise hell about it before because I am out my contribution for that amount of time and I bring up the point that it is like me taking money from them when they get paid an giving it to them later. I am also one of two people who contribute and the check writer so to speak does not. I contribute $440 twice a month, if that matters.
So my question(s):
Am I overreacting and that time frame is acceptable in a digital age that we are in?
I know it works out in the long run, but a couple of times I could have taken advantage in price drops within my fund only to wait a week until my contribution went in and the price is back up.
I feel three business days is plenty. What say you?
Two side notes, first I am on mobile so forgive any spelling mistakes and secondly there was one period when I got paid twice and my first contribution still wasn't there.
5
Posted on 9/8/14 at 7:03 pm to OnTheBrink
quote:
Am I overreacting and that time frame is acceptable in a digital age that we are in?
i mean, its not acceptable but its not that ridiculous. My wife works for a small company, and it takes a week or two for them to get the money.
Also, I wouldn't put it past the company that manages the 401k to hang onto it. Cash management strategies provide big business for financial services firms.
Posted on 9/8/14 at 7:09 pm to OnTheBrink
I had thought abt this before and put on my tinfoil hat.
It sounds like HR is sitting on the check until they have more than one, can you not do automatic contributions?
Also, my experience and from talking to some friends who work in the 401k management group is that it takes 3 business days from when you get paid to deposit.
Paid on Friday it's deposited following wed and shows up in acct on Thursday.
When I wrote a direct check it took like 7-10 business days, but I expect part of that was from the mail.
It sounds like HR is sitting on the check until they have more than one, can you not do automatic contributions?
Also, my experience and from talking to some friends who work in the 401k management group is that it takes 3 business days from when you get paid to deposit.
Paid on Friday it's deposited following wed and shows up in acct on Thursday.
When I wrote a direct check it took like 7-10 business days, but I expect part of that was from the mail.
Posted on 9/8/14 at 7:10 pm to Hawkeye95
Yeah, that's what I was thinking.
The 401k or my employer s pulling a office space plan and keeping interest on everyone's contribution for a day.
The 401k or my employer s pulling a office space plan and keeping interest on everyone's contribution for a day.
Posted on 9/8/14 at 8:21 pm to OnTheBrink
You write a check and give it to HR to contribute to 401k?
Posted on 9/8/14 at 8:56 pm to OnTheBrink
Is the plan audited? If so, them holding the money would easily be caught.
Posted on 9/8/14 at 8:56 pm to HeadyMurphey
I work for a municipality, so yes. Believe me, I have argued about that as well. Hell we just got direct deposit 3 or 4 years ago.
But our office manager brings me a check, I then walk a couple of blocks and take the check to HR. Crazy huh?
But our office manager brings me a check, I then walk a couple of blocks and take the check to HR. Crazy huh?
Posted on 9/8/14 at 9:24 pm to OnTheBrink
This thread amazes me.
My 401k only makes its purchases once a month, even though I contribute 2x a month. It's usually a few days after the 1st. Never was a big deal to me. DCA'ing over years, it won't make a difference. Sometimes it'll be up, sometimes down. I'm sure if you look back you'll find times when the delay actually made you some money.
My 401k only makes its purchases once a month, even though I contribute 2x a month. It's usually a few days after the 1st. Never was a big deal to me. DCA'ing over years, it won't make a difference. Sometimes it'll be up, sometimes down. I'm sure if you look back you'll find times when the delay actually made you some money.
Posted on 9/9/14 at 7:11 am to LSUtigerME
quote:
Never was a big deal to me. DCA'ing over years, it won't make a difference. Sometimes it'll be up, sometimes down. I'm sure if you look back you'll find times when the delay actually made you some money.
Yeah, as I said, that is just me really nitpicking. It seems I only remember the times when it is down.
quote:
My 401k only makes its purchases once a month, even though I contribute 2x a month.
This is just crazy to me. Someone is making money off of you in the meantime.
Posted on 9/9/14 at 8:59 am to OnTheBrink
The rule I believe, based on the last time I talked to a 401k auditor (which was about two years ago) was this:
It has to be deposited as soon as the money can reasonably be segregated from company assets, but in no case can it be after the 15th of the month after the paycheck that gave rise to the contribution.
Also, there is a safe harbor provision that provides if the deposit was made within 7 business days, the Dept of Labor won't hassle anyone.
Ours are sent via EFT on payday, recieved by the TPA on the next day, and deposited and credited to our account as of close of business of the third day.
It has to be deposited as soon as the money can reasonably be segregated from company assets, but in no case can it be after the 15th of the month after the paycheck that gave rise to the contribution.
Also, there is a safe harbor provision that provides if the deposit was made within 7 business days, the Dept of Labor won't hassle anyone.
Ours are sent via EFT on payday, recieved by the TPA on the next day, and deposited and credited to our account as of close of business of the third day.
Posted on 9/9/14 at 9:00 am to OnTheBrink
There is a time requirement from the DOL. Small businesses have 7 days from withholding or receipt of funds to get them into the plan to be deemed in compliance with the rules.
Larger companies (100 Employees+) do not follow the same safe harbor rule and must submit as soon as reasonably possible but no later than the 15th business day of the month following. On DOL audit for large plans they will write you up if they think it could have been done faster than half way through the following month. As a rule of thumb for large plans I recommend to clients if everything is electronic it should be done with in 7 business days (If you do it even once at less time then you have set your own standard shorter and will be held to that on audit). If they are mailing in a check within 15 business days.
EBSA News Release: [01/13/2010]
Contact Name: Gloria Della
Phone Number: (202) 693-8664
Release Number: 10-0056-NAT
US Department of Labor issues final safe harbor rule on employee contributions to small pension and welfare plans
WASHINGTON — The U.S. Department of Labor today announced the publication of a final rule to protect employee contributions deposited to small pension and welfare benefit plans with fewer than 100 participants by providing a safe harbor period of seven business days following receipt or withholding by employers.
"This rule will give employers greater clarity in remitting participant contributions to small pension and welfare plans in a timely manner," said Phyllis C. Borzi, assistant secretary of labor for the department's Employee Benefits Security Administration. "We estimate participant accounts could grow by $19 to $44 million as a result of these rules."
Currently, employers of all sizes must transmit employee contributions to pension plans as soon as they can reasonably be segregated from the general assets of the employer, but no later than the 15th business day of the month following the month in which contributions are received or withheld by the employer. The latest date for forwarding participant contributions to health plans is 90 days from the date on which such amounts are received or withheld by the employer.
The final rule amends the participant contribution rules to create a safe harbor period under which participant contributions to a small plan will be deemed to comply with the law if those amounts are deposited with the plan within seven business days of receipt or withholding. The final rule is consistent with the proposed rule. The department did not expand the safe harbor to cover plans with 100 or more participants due to a lack of information and data sufficient to evaluate current practices of such employers and assess the costs, benefits and risks to participants associated with extending the safe harbor to large plans.
The final rule is to be published in the Jan. 14, 2010, edition of the Federal Register and will be effective on the date of publication.
Larger companies (100 Employees+) do not follow the same safe harbor rule and must submit as soon as reasonably possible but no later than the 15th business day of the month following. On DOL audit for large plans they will write you up if they think it could have been done faster than half way through the following month. As a rule of thumb for large plans I recommend to clients if everything is electronic it should be done with in 7 business days (If you do it even once at less time then you have set your own standard shorter and will be held to that on audit). If they are mailing in a check within 15 business days.
EBSA News Release: [01/13/2010]
Contact Name: Gloria Della
Phone Number: (202) 693-8664
Release Number: 10-0056-NAT
US Department of Labor issues final safe harbor rule on employee contributions to small pension and welfare plans
WASHINGTON — The U.S. Department of Labor today announced the publication of a final rule to protect employee contributions deposited to small pension and welfare benefit plans with fewer than 100 participants by providing a safe harbor period of seven business days following receipt or withholding by employers.
"This rule will give employers greater clarity in remitting participant contributions to small pension and welfare plans in a timely manner," said Phyllis C. Borzi, assistant secretary of labor for the department's Employee Benefits Security Administration. "We estimate participant accounts could grow by $19 to $44 million as a result of these rules."
Currently, employers of all sizes must transmit employee contributions to pension plans as soon as they can reasonably be segregated from the general assets of the employer, but no later than the 15th business day of the month following the month in which contributions are received or withheld by the employer. The latest date for forwarding participant contributions to health plans is 90 days from the date on which such amounts are received or withheld by the employer.
The final rule amends the participant contribution rules to create a safe harbor period under which participant contributions to a small plan will be deemed to comply with the law if those amounts are deposited with the plan within seven business days of receipt or withholding. The final rule is consistent with the proposed rule. The department did not expand the safe harbor to cover plans with 100 or more participants due to a lack of information and data sufficient to evaluate current practices of such employers and assess the costs, benefits and risks to participants associated with extending the safe harbor to large plans.
The final rule is to be published in the Jan. 14, 2010, edition of the Federal Register and will be effective on the date of publication.
This post was edited on 9/9/14 at 9:01 am
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