While it is true retirement funds invested in 401k plans continue to earn interest and accumulate potential capital gains even after a business no longer exists, there is an important caveat. Even though benefits belong to the employee, plan administrators can terminate your further participation in the plan if you (or your heirs) fail to claim plan benefits or cash a benefit check.
The financial institutions holding unclaimed 401K assets – banks and brokerages appointed by the plan administrator – make little if any effort to locate lost employees and missing retirement plan participants, because by law their responsibility is to the company, not the employee. (Some lost participants may receive notice from the Social Security Administration, but only after reaching retirement age).
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