Did anyone else notice the change in the 401k matching plan for this year going forward?
Match will be once a year on or about December 15...that will save a LOT due to layoffs!
18 replies (most recent on top)
Best time to retire is still April 1st. Reason is that you'll already have gotten the annual 401k match in December, plus your bonus for the previous year which is paid in March. April 1st is better than March 31st because you get health insurance until the last day of the month in which you retire.
@2bzk+18IWzsA2 Guess you missed the 70’s... Financial Services the last major business to get hit. For the bulk of America pensions were gone for good by 1980 at latest.
Doesn’t it?
@3mmz+18IWzsA2, very true that the new vesting on the 401k match is very common and this change is in line with many other plans. Yes, it is a tool for employee retention.
In my earlier post I was just pointing out that the vesting schedule is another significant change to what was a VERY generous 401k employee benefit. The changes are moving in the direction of average BUT we still have dollar-for-dollar matching (vs 50 cents on the dollar) with a total match that can amount to 6% (vs 3%). It is still an excellent plan (for now) and the recent changes, for me, just mean a loss of quarterly dollar cost averaging and the risk of missing out on 1 year of matching (vs 1 quarter) if my employment changes.
Vesting periods are hardly exclusive to the financial industry, lots of businesses across pretty much every sector have vesting. It's a tool to support retention. If you're staying medium/long term, it has no impact on you. If you're a job hopper, that's cool, you just don't get a match.
This was news to me (guess I should read the emails). Now that I've looked at them I see
1) Match will be made annually (instead of quarterly)
2) "You must be employed on December 15 of the year, with exceptions for death, termination/retirement age 65 or older, or disability."
3) Match will be deposited into your 401(k) Plan account on the last business day of the year
Another interesting gotcha for new hires (but not existing employees) is the vesting. New hires will need to work for Wells for 3 years to become 100% vested on the match and associated gains.
"Those hired on or after Jan. 1, 2021, will become 100% vesting in Matching Contributions and investment gains after three years of service, meaning if they leave Wells Fargo before then, the amount available for distribution from the 401(k) Plan will not include these amounts (certain exceptions apply)."
I find it so odd financial professionals are the only industry to suffer this clear rip off of benefits in a stay or else weaponization of retirement.
MUFG and JPMC do the same thing
ONLY retirements of employees 65 or over will get the accrued matching funds. Read the fine print people.
Yes, we all noticed months ago when it was announced and shared ad nauseum via email, Teamworks, managers, etc.
JPMC light
Yeah, they communicated this to you like ten times since they made the decision a few months ago. Read your emails.
You will get the match even if you retire or are displaced prior to December, you will not get it if you leave voluntarily.
Even JPMC does the same thing .. Isn't it?
Is this December date new this year for matching?
Sounds like they plan to cut a lot of jobs or bully everyone out early in the year
Welcome to last month!
You have to be employed until the 401k match in December in order to receive it. So if you are displaced, leave voluntarily, or retire before December you do not get 401k match. Very shady of Wells Fargo.
Glad I just got a new job, just starting and just got sign on bonus.
Also all the other area's of income and benefits are much higher than here. Culture seems like a good fit there too. I am sure i made the right choice moving on now rather than staying here.
Makes December "retirement month" for those that want their match and to sell back a years worth of PTO.