I imagine it’s on purpose - people are nervous about paper checks and leave their money in the existing account out of inertia. I know that was a factor for me.
There was a discussion about this in another thread (or perhaps earlier in this one?), and the general consensus was that it depended on the parties involved. Last year, I did the exact same thing you did–moved my money from my 401k to an IRA at Fidelity. It was accomplished via a wire transfer; once I submitted the proper paperwork, the process took about 5 days.
Now this is the way it should be done, by everyone!
Agreed! I had no choice but a paper check for my recent transfer. It was showing in my Informed Delivery account, but not in my mailbox. Eventually I found the envelope lying in the open ON THE FRONT STEPS. Needless to say, a complaint was filed.
At least mine is being sent directly to Schwab.
My opinion is that the paper check thing is a tool of the more sketchy, high-fee servicers who don’t want you to take your money from them.
I’ve had TWO experiences with servicers who seemed hell bent on making it difficult, both companies I hadn’t heard of until they had my wife’s 401k, and both of which charged outrageous fees. Also, neither offered low-cost index funds, only expensive managed funds.
That was me upthread.
Fidelity could not transfer my 401K assets they were managing for my employer elsewhere except by paper check.
But I could open a Fidelity IRA and then they’d transfer the assets from my 401K to my shiny new IRA electronically instantly. Then I could transfer those IRA assets electronically elsewhere. The whole process took longer than expected, but it was electronic end to end. Lots more tiresome details in my posts starting in early Dec 2024 if anyone cares.
Just chiming in here to say that yesterday was my 26th anniversary at my current job and I am DEFINITELY starting my countdown.
48 months to go…
Woooo let’s go!
Is there a special prize or some kind of bump at thirty years?
Longest I lasted on a job was my last one, 12 years, 5 months. It barely eked out the second place job at 12 years, 3 months.
I got a lamp!
Also, always more money because pension formula. But also, a lamp!
Twenty years at my job actually does get a one time small permanent percentage pay increase, variously referred to as “old timer pay” or more popularly “dinosaur pay.” It’s also when vacation hours max out. Otherwise every year in a pension system helps (unless you reach a cap). But if you’re not in one, it’s purely psychological - some people just like nice round numbers.
Yeah, I get a larger pension for 30 years than for 26.
The County as a program called DROP that lets you work past 30 years. You get your base pay and your pension is paid into an interest-bearing account until you finally do leave. So you get “double” pay. You can do this for up to 8 years.
It’s tempting since I hit 30 years at 58 and won’t be getting SS for a few years after that (at best). But not being at work anymore is such a huge thing for me.
I got diddely-do for 30.
I recall getting gifts at 10-15-20-25, remember those corporate gift catalogs?
mmm
My company had an excellent catalog for a while, I got some kind of recognition that yielded two heavy-duty speakers that I still use. But then the catalog got less good.
I got a little stuff for my 5 and 10 year gifts. Then the economy tanked in '07 and THAT ended the gifts. We still got the little year pins at a ceremony but that has also been replaced with commemorative coins.
Just yesterday, I got to thinking about my healthcare insurance provided by my employer. Now I’m wondering how I’m going to handle that if I retire in four years versus doing the post-retirement work.
In four years, at the time of your retirement, how old will you be? If you’ll be 65, you can sign up for Medicare, but you will still need supplemental heath insurance.
If you won’t be 65, then your options are Marketplace (ACA/Obamacare), or continuing your employer’s insurance via COBRA. I would posit that either option will be quite a bit more expensive than what you’re paying now.
If you are no longer earning much income and living off of savings, ACA premiums are free in California.
I schedule my retirement so that my wife would get Medicare just before my COBRA for her ran out. I checked out ACA (I’m in California) and found the coverage not nearly as good as the work coverage I could extend with COBRA. I do suspect it was cheaper but that wasn’t a factor.
CaliforniaCare is definitely not as good as my corporate insurance was so if premium cost isn’t a concern, you certainly did the correct thing.