This seems like a silly question to some people because they feel like they know where everything is located and where it is being held. But this is an ever increasing issue with people who have retired or will be retiring. Most know of the major accounts they have contributed to over time but in many cases there are accounts that are forgotten and end up being lost. As more and more accounts have digital access and tracking, this happens more often.
It was easy in the “old days” where employees worked for the same employer their entire career and know where they are getting their pension or retirement from. But today, most employees have had 5 – 15 jobs and if they had a career of 30 or 40 years they could easily have qualified for some type of retirement from one of their employers. But since it was short and a while ago, many times they don’t think about these as possible sources.
It is quite common for people to have a retirement account through an old employer that they have forgotten about. When you leave a job that had a 401(k) plan, for example, you are still entitled to your funds through that plan. This is true, even if you never did anything with the retirement funds after you left that job.
Even when people do remember their old accounts, they have trouble locating any information about them. This can happen for a variety of reasons…such as their earlier employer has gone out of business or sold the company, or changed the name.
In total, this problem costs Americans some $150 billion that they are owed as Kiplinger reports in "Missing Retirement Accounts Cost Retirees Billions."
There is a bipartisan piece of legislation in the Senate that would make things easier for people to find the money they are owed. It would require the creation of a central database, so people could search for their own accounts. While this seems simple enough, it is a very complex undertaking and also has lots of security risks to it if it was “hacked” by an outsider.
Because of these potential risks and costs, this legislation is being opposed by the industry. If you are interested in this or passionate about it (regardless of your perspective) you might want to contact your Senator and share your opinion. In the meantime, do your own due diligence on your own background and your past employers. With a little effort most people can identify most, if not all, of their IRA and retirement accounts.