Wednesday, February 07, 2007

401k lagtime...real or BS?

Okay I'm really pissed with DH's 401k from his company. They take forever to deposit the money into the account. The last deposit was on 1/17/2007 for the deduction from the 1/5/2007 paycheck. He is paid biweekly, so the 1/19/2007 paycheck has not been deposited, nor has the 4th quarter match from the company. What is going on? Also he got his annual raise/bonus on 2/2/2007 and of course nothing has occurred, though his 401k was deducted out of the bonus for $1500 that should be deposited.

I think this is utterly ridiculous that the company can't get their act together. I am fine with the company taking 2 weeks to input the deduction, but it's over well over two weeks now for the 1/19 paycheck and it's been over a month for the company match since the end of the 4th quarter of 2006.

Is this how all companies work? I think that the company should be paying for this loss of time. I am hoping that it gets posted by the end of February which might make up the shortfall we experienced last month in net worth.

8 comments:

Anonymous said...

Big company or small? I can see this happening with a small company... but probably inexcusable for a big company.

Living Almost Large said...

About 1000 employees, I don't think it's small, but it's not huge.

Anonymous said...

My 401k matching contributions show up within a week of my payroll deposit. And since I only get paid once a month, a week's delay is only 1/4 of a pay cycle. To be still waiting for your 2006 matching contributions, in FEBRUARY of 2007, is inexcusable. To be still waiting for your own contributions to show up even as long as a week after they're made, ought to be treated as a form of embezzlement.

Living Almost Large said...

I just don't get it either. I think it's also unforgivable to be waiting since the end of 2006. And it's definitely unfair that the last contribution was about 3 weeks ago for a paycheck 5 weeks ago.

Anonymous said...

There is a law that I can't quote verbatim right now, but I believe it says that companies must deposit 401k contributions as soon as reasonable business practices allow, but no later than 14 days after the contribution. I doubt that would apply to matching contributions though.

What I read (unfortunately I can't recall the source) basically said that if a company is reasonably capable of depositing the funds in say five days, then it has to. I have no idea what it takes to move money like that and make sure it all ends up in the right places, but I've got to believe in this day and age it can be in minutes not days.

Since the rule sets a standard though, it probably is going to be hard to challenge any company that gets it done in less than 14 days. I worked for one (very large) company that usually deposited the funds at 13 or 14 days. Every now and then it made it in five days though. I briefly contemplated challenging them, since they had shown they were capable of depositing the funds in five days on a somewhat regular basis, but that probably would have been as painful and fruitful as banging my head on a brick wall.

I now work for a equally large company that deposits the funds the same day with very few exceptions. Unless you're working for a company that still uses paper checks exclusively for payroll transactions, it seems to me this ought to be the norm.

Living Almost Large said...

For some reason it just doesn't happen. I feel like bugging DH but he hates it when I tell him to email HR. Usually the contributions take 2-3 months after the quarter ends so it ends up almost being the next quarter's match.

Last time the 2006 Q3 match was 12/4/2006!

mOOm said...

Yeah that's what my university does with my 403b contributions.

Living Almost Large said...

It took one month basically from the date of the debit from the paycheck to the transfer into Fidelity's 401k! Arrgh.