You work hard at your job to earn a decent living and hope to retire comfortably one day, thanks to the contributions made to your 401(k). The long hours and missed opportunities with family and friends are all part of the sacrifices you make to one day be able to relax and enjoy your life in your retirement years.
However, lately, you are a little concerned: There are some anomalies regarding your statements for your 401(k). You are no CPA, but you wonder if there might be something amiss with the financial statements you have received.
What could go wrong with your pension plan?
Basically, when you entrust the stewardship of your 401(k) to your company, there are two major problems that could arise — mismanagement and fraud. Both can leave you with less than you anticipated at retirement, or even nothing at all as a cushion during your golden years.
Signs of misuse of your 401(k)
Your 401(k) is subject to stock market volatility — and lately, it’s been a wild ride. Employees should understand that there will be peaks and valleys and that they are in for the long haul. With that being said, however, if you suspect there may be more at play than a volatile market, be on the lookout for these potential signs of fraud:
- Your company is not transmitting employee contributions according to schedule
- Your account statements are delayed routinely
- There appear to be errors regarding your balance
- Your account statement lists unauthorized investments or activity
- Your company is in a cash squeeze and struggling to remain viable
- There is an unusually high turnover of investment managers
- Former colleagues who have retired mention they are having problems accessing benefits
Be aware, too, that honest mistakes can occur, people change jobs and systems may experience troublesome glitches from time to time. So, one or even two of the above red flags could have logical explanations. But ERISA fraud is still a concern. If you suspect there is something worse occurring, an attorney who deals with ERISA fraud can help you sort things out.