OT: 401k question on transferring and timeframe for approval

[jaydogsmooth1]

Switched jobs back in June, put in to transfer my work 401k from Vanguard (who held it while i was employed at the old place) to Morgan Stanley (where my Rollover 401k from previous employers is).

Dates
7/15 = Put in transfer request online
7/26 = Followed up w/Vanguard, they said to call former employer as they hadn't approved it yet - called them, they said they just approved it and it was all set
8/6 = Followed back up w/Vanugard, they said former employer still hadn't approved it
8/6 = Called former employer, they said they just approved it, and another person had to do it, hence the delay

*** Just spoke with Vanguard, I lost 16k b/c my former employer sat on it instead of approving things when I requested it. Not for a day, but for 3 weeks. Is there any recourse here to recoup the money? Small claims court, lawyer, etc.

Thanks in advance

 

[patk89]

How did you lose $16K? Lost market opportunity? Good luck with suing for that. These transfers take some time, there has been fraud so the investment companies need to be sure everything is done properly. Vanguard customer service is not great.

 

[jtung230]

Check today and you probably made all that back already.

 

[JayDogSmooth]

How did you lose $16K? Lost market opportunity? Good luck with suing for that. These transfers take some time, there has been fraud so the investment companies need to be sure everything is done properly. Vanguard customer service is not great.

I lost it bc the check cut to me from Vanguard, who I’ll then send to Morgan Stanley, is 16k less than the amount it was supposed to be, from the original date I requested it to the time it took their lazy asses to approve it, through no fault of my own

 

[JayDogSmooth]

Check today and you probably made all that back already.

Check has already been cut and in the mail
Hence, not active in the market

 

[jtung230]

I lost it bc the check cut to me from Vanguard, who I’ll then send to Morgan Stanley, is 16k less than the amount it was supposed to be, from the original date I requested it to the time it took their lazy asses to approve it, through no fault of my own

Why didn’t you go to cash before the transfer if you didn’t want market fluctuation?

 

[rutgersdave]

Should have been wire transfer in the first place.

 

[JayDogSmooth]

Why didn’t you go to cash before the transfer if you didn’t want market fluctuation?

That would have, and should have, been the move.

Been traveling around crazy for the new gig and between the meetings, flights and hotels, didn’t even consider that as I just assumed it would transfer immediately

 

[JayDogSmooth]

Should have been wire transfer in the first place.

Yeah, I don’t understand why they couldn’t have done a wire, I need to go to the old-school way of mailing on a check

 

[mdk01]

Should have been wire transfer in the first place.

These transfers take some time

Rollover from a qualified plan is not something that is a 24 hour procedure. Wire transfer would have been better, but again it's not like selling stock in a personal taxable account followed by a transfer to a checking account.

 

[JayDogSmooth]

Rollover from a qualified plan is not something that is a 24 hour procedure. Wire transfer would have been better, but again it's not like selling stock in a personal taxable account followed by a transfer to a checking account.

I understand it’s not a 24 hour procedure, but unless I’m mistaken, I don’t think it’s a three week procedure either

 

[Zak57]

No offense OP but no one to blame here but yourself and sorry you lost that money. Operations between field take time and you needed to ask some questions beforehand.

 

[JayDogSmooth]

No offense OP but no one to blame here but yourself and sorry you lost that money. Operations between field take time and you needed to ask some questions beforehand.

No offense taken

Lesson learned and part of the reason I come to this board at times with questions is bc I respect the intilect here and know in typical Jersey fashion, we won’t mince words and give bullshit answers

 

[365Poster24Seven]

OP these guys just showed you why you never ask advice on an anonymous message board. They are all shitting on you like they do the football team on Saturdays. Go ask someone that knows not guys who can give a you know what about you.

 

[rurichdog]

My 401k rollover was delayed 10 days by my Human Resources. They had the check in-hand for a Fidelity to Fidelity transfer and they still managed to botch it up.

 

[JayDogSmooth]

OP these guys just showed you why you never ask advice on an anonymous message board. They are all shitting on you like they do the football team on Saturdays. Go ask someone that knows not guys who can give a you know what about you.

I look at it as if people (in this case, myself) put stuff out there, they are fair game.

I asked the question because i respect the hell out of a significant number of posters on here for their knowledge on a variety of different topics

We may disagree on a lot of things football related, NIL, and FSU, but there’s arguing that there’s a lot of people on here who are knowledgeable about many different topics

 

[JayDogSmooth]

My 401k rollover was delayed 10 days by my Human Resources. They had the check in-hand for a Fidelity to Fidelity transfer and they still managed to botch it up.

That’s the maddening part, but again, as I stated before, I should have liquidated all the assets instead of just assuming things would be good to go

 

[Zak57]

No offense taken

Lesson learned and part of the reason I come to this board at times with questions is bc I respect the intilect here and know in typical Jersey fashion, we won’t mince words and give bullshit answers

I meant firms not fields. Wish we could have helped earlier!! You'll make it back for sure though.

 

[JayDogSmooth]

I meant firms not fields. Wish we could have helped earlier!! You'll make it back for sure though.

Yeah, I should’ve been smarter and slow things down, I thought it through a bit better.

All good though, life is a beautiful thing and football is right around the corner

I wonder if there’s any recourse legally though?

 

[Zak57]

Yeah, I should’ve been smarter and slow things down, I thought it through a bit better.

All good though, life is a beautiful thing and football is right around the corner

I wonder if there’s any recourse legally though?

Anything is possible with a good lawyer but I'm sure this stuff is covered in the small fine print that no one reads.

I work for one of the larger financial firms and they cover themselves with legalese as much as possible while still trying to really help the customer but you have to read all the material.

 

[JayDogSmooth]

Anything is possible with a good lawyer but I'm sure this stuff is covered in the small fine print that no one reads.

I work for one of the larger financial firms and they cover themselves with legalese as much as possible while still trying to really help the customer but you have to read all the material.

Yeah, I figured it’s more on the employer than the actual firm themselves, which is what chaos my ass because theoretically, all they had to do was hit approve and I wouldn’t be all pissed off like I am lol

 

[Zak57]

Yeah, I figured it’s more on the employer than the actual firm themselves, which is what chaos my ass because theoretically, all they had to do was hit approve and I wouldn’t be all pissed off like I am lol

Haha it's more than you think. I'm sure everyone is to blame honestly.

 

[coloradoknight]

Pretty sure most 401k Rollovers are done by check still.

 

[T2Kplus20]

Why didn’t you go to cash before the transfer if you didn’t want market fluctuation?

This ^^^^^
Can't assume companies will be quick with anything.

 

[T2Kplus20]

My 401k rollover was delayed 10 days by my Human Resources. They had the check in-hand for a Fidelity to Fidelity transfer and they still managed to botch it up.

I have done 2 Fidelity 401K transfers to Fidelity Rollover IRAs and both times Fidelity handled it that same day. No checks, no paperwork, just call them.

 

[RURahh]

@JayDogSmooth - I had a very similar situation where the 401k manager would only send a paper check in the mail. The funds were all in fixed income and the incompetence if the investment manager. It took 7 weeks and 10 emails/ phone calls to finally receive it

I filed a claim with the plan sponsor which had been ignored for almost 2 months. I will potentially file a case in FINRA arbitration which is not that expensive, but needs to show either fraud or negligence. I didn't read thru all the posts but could you prove that if you got the funds real time. You would've prevented the 18k loss?

 

[mdk01]

[

I have done 2 Fidelity 401K transfers to Fidelity Rollover IRAs and both times Fidelity handled it that same day. No checks, no paperwork, just call them.

Trustee to trustee transfer of cashed out balance? Fidelity on both ends probably sped things up but it usually takes some time for the sign off from the former employer.

 

[Morrischiano]

Switched jobs back in June, put in to transfer my work 401k from Vanguard (who held it while i was employed at the old place) to Morgan Stanley (where my Rollover 401k from previous employers is).

Dates
7/15 = Put in transfer request online
7/26 = Followed up w/Vanguard, they said to call former employer as they hadn't approved it yet - called them, they said they just approved it and it was all set
8/6 = Followed back up w/Vanugard, they said former employer still hadn't approved it
8/6 = Called former employer, they said they just approved it, and another person had to do it, hence the delay

*** Just spoke with Vanguard, I lost 16k b/c my former employer sat on it instead of approving things when I requested it. Not for a day, but for 3 weeks. Is there any recourse here to recoup the money? Small claims court, lawyer, etc.

Thanks in advance

So speaking from my own experience because I did this in the last year. Some banks will do a wire rollover and some have to cut you a physical check. I had 3 old 401Ks from 3 previous jobs from the last 20 years. I finally consolidated them this spring into a Rollover IRA. One was a wire transfer and my money was out of the market for 1 day. Easy peazy. The other two were mailed. One check came in less than 7 days. I deposited it immediately. The other check never came. I called a few days later and the fund said they liquidated the account and cut the check. I never received it. They overnighted a new check and I deposited it asap. Luckily the market gave back about 3% while the two checks were in the mail.

In your case, you really didn’t “lose any money”. Let’s say your $100,000 401k is now worth $84,000 and assume you had 1,000 share of your target fund. Let’s also say your new 401K has the same target fund. If you sell the old account and buy $84,000 in the new account you will still have 1,000 shares. Yes your asset declined in value but so did the purchase price of your new asset.

The only way you get hurt is if the check is in transit and the market goes up during that time.

As far a legal action, I’m sure there is some fine print that you signed in the transfer docs that prohibits you from indemnification for any delays.

It’s a different matter if you put in a market sell order in the middle of the day in a liquid market and it never got executed. For that , you can easily get compensation.

 

[JayDogSmooth]

@JayDogSmooth - I had a very similar situation where the 401k manager would only send a paper check in the mail. The funds were all in fixed income and the incompetence if the investment manager. It took 7 weeks and 10 emails/ phone calls to finally receive it

I filed a claim with the plan sponsor which had been ignored for almost 2 months. I will potentially file a case in FINRA arbitration which is not that expensive, but needs to show either fraud or negligence. I didn't read thru all the posts but could you prove that if you got the funds real time. You would've prevented the 18k loss?

Yes, I have the documents saying what the account value was on 7/16 and 8/7 respectively

 

[JayDogSmooth]

So speaking from my own experience because I did this in the last year. Some banks will do a wire rollover and some have to cut you a physical check. I had 3 old 401Ks from 3 previous jobs from the last 20 years. I finally consolidated them this spring into a Rollover IRA. One was a wire transfer and my money was out of the market for 1 day. Easy peazy. The other two were mailed. One check came in less than 7 days. I deposited it immediately. The other check never came. I called a few days later and the fund said they liquidated the account and cut the check. I never received it. They overnighted a new check and I deposited it asap. Luckily the market gave back about 3% while the two checks were in the mail.

In your case, you really didn’t “lose any money”. Let’s say your $100,000 401k is now worth $84,000 and assume you had 1,000 share of your target fund. Let’s also say your new 401K has the same target fund. If you sell the old account and buy $84,000 in the new account you will still have 1,000 shares. Yes your asset declined in value but so did the purchase price of your new asset.

The only way you get hurt is if the check is in transit and the market goes up during that time.

As far a legal action, I’m sure there is some fine print that you signed in the transfer docs that prohibits you from indemnification for any delays.

That’s all well and good, but yes, I did actually lose the money

If the check was cut when I requested it, I’d have 16k more

Your theory is good “in theory,” but the fact remains that I’m down 16k due to a delay in processing the check

 

[Morrischiano]

That’s all well and good, but yes, I did actually lose the money

If the check was cut when I requested it, I’d have 16k more

Your theory is good “in theory,” but the fact remains that I’m down 16k due to a delay in processing the check

And now the market rallied and you’re only down $5K.

 

[RURahh]

That’s all well and good, but yes, I did actually lose the money

If the check was cut when I requested it, I’d have 16k more

Your theory is good “in theory,” but the fact remains that I’m down 16k due to a delay in processing the check

I an assuming the loss came from market conditions. Can you prove that the funds were going to be moved to a more stable investment with little to no market risk. If so, you may have a claim, and you would likely need to show negligence on the part of your old company .Also, there might be an arbitration clause in your 401k that limits all lawsuits to FINRA arbitration

Good Luck

 

[JayDogSmooth]

I an assuming the loss came from market conditions. Can you prove that the funds were going to be moved to a more stable investment with little to no market risk. If so, you may have a claim, and you would likely need to show negligence on the part of your old company .Also, there might be an arbitration clause in your 401k that limits all lawsuits to FINRA arbitration

Good Luck

Admitelly, that’s hard to prove

 

[JayDogSmooth]

And now the market rallied and you’re only down $5K.

The money isn’t in the market though
The check is in transit - hence, nothing in the account

 

[RURahh]

I

Admitelly, that’s hard to prove

Gonna be tough but maybe filing a claim will get you a settlement

I feel for you, the timing sucks

 

[T2Kplus20]

Trustee to trustee transfer of cashed out balance? Fidelity on both ends probably sped things up but it usually takes some time for the sign off from the former employer.

I guess. The 401ks were via Fidelity Net Benefits. They were able to open a Fidelity rollover IRA and transfer the money over the next trading day. I believe any Fidelity funds transferred directly and the non-Fidelity funds were cashed out and the cash moved over. Everything was ready to go the next trading day.

By the way, I did the same thing with T Rowe Price. TRP 401k to a TRP rollover IRA the next trading day. Completely paperless and automatic.

These three 401ks were from pharma companies.

 

[jtung230]

I don’t think you have recourse. It’s administrative BS. In the long run, this will be a rounding error. Congrats on the new opportunity.