Forget to Roll Over Your 401(k)? Find It in This New ‘Lost & Found’

Did you forget something when you left your last employer?

Not the threadbare office sweater — your 401(k). Forgetting that could cost you.

Many companies stop maintaining a former employee’s 401(k) if there’s less than $5,000 in the account. Although it might be tempting to get a check for the remaining amount right away, cashing out your 401(k) comes with financial penalties and taxes while reducing your retirement savings.

But now a group of the largest 401(k) plan administrators, including Fidelity and Vanguard, are creating a way to change that — a sort of “lost and found” to make sure your old 401(k) accounts don’t slip out of your grasp.

And as more of us change jobs more frequently, there are additional opportunities for more of these small 401(k) accounts to be hanging around.

Here’s how you can track down your old 401(k) and hold onto more of your retirement savings.

‘Losing’ Your 401(k) Account

To be fair, a lot of this money isn’t totally, totally It’s a little more complicated than that.

When you quit your job, you can’t contribute to your old 401(k) account anymore. But that money still belongs to you. You should roll it over into a new plan — either your new company’s 401(k) or an individual retirement accountaka an IRA.

If you fail to roll over your old 401(k) account and it’s less than the company’s minimum amount required to maintain the account, your long-term retirement investments from that account may be liquidated into cash whether you want that or not.

So instead of seamlessly continuing to invest that money for your golden years, you’ll eventually get a lump-sum check in your mailbox.

Doesn’t sound like a big deal? The catch is that you’ll pay nasty financial penalties, and the loss of even a small 401(k) account can put a serious dent in your retirement plans down the line.

If you’re younger than 59 when you cash out a retirement account, you’ll immediately pay a…