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Leaving Your 401(k) Past Behind: Concerns Over Terminated Participants with an Account Balance (PDF)
Robert J. Leahy, CEBS, AIF, via fi360 Link to more items from this source
Apr. 28, 2014
"The most obvious reason to minimize the number of terminated participants with a balance has to do with cost.... [A]dvisors are in a perfect position to take the lead in developing a process to address this issue.... Step 1: Review with your TPA or bundled provider the rules in the plan document that pertain to participant force-outs.... Step 2: Request from your recordkeeper a list of all terminated participants with a balance, preferably in a spreadsheet format.... Step 3: Work with the plan sponsor to draft a notice to participants that are eligible for force-outs ... Step 4: ... [C]ompose a letter along with communication materials to send that outlines the advantages of control and investment flexibility with an IRA rollover."

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