Expert: Allen - 4/29/2009

Question
I heard some time ago that pensions can be accessed, pulled and rolled over into IRAs or the like.  I was with ABC company for 5 years. More recently, XYZ company for 18 years. I am no longer in either employ. In light of the financial market, I would like to 'pull' my pensions out of Union hands in order to place those funds into a more stable scenario. (After Enron, etc., even my Money Market Fund looks healthier.)I don't trust any of the several Unions I have been involved in, who are 'managing' my pensions. Needless to say, the Union Reps I have spoken with are not forthcoming in giving me the information I need to make this happen. Still, I believe it is MY right to place my earnings where they will be the most beneficial to ME. I have been a victim of layoffs, and loss of employment due to work-related disability and have been trying to fund a start-up business. Perhaps I can't use the pensions for that purpose but, I would still rather have my own say regarding how they are used, distributed, etc., than an entity that has done little to nothing regarding my keeping employment in the first place. (If they had worked to keep me in those positions, I would still be making them big bucks!)
So, how do I go about making the withdrawals? Where do I find forms? Or was I totally misinformed?

Thanks for your time and help,

M

Answer
Some plans allow for payout of a terminated participant's account at the time of termination or shortly thereafter. Other plans require the participant to wait until the retirement age specified in the plan documents. So you may be able to transfer your accounts or you may not be able to - the answer depends on the wording in the plans.

I suggest:
1. Make a written request to the Plan Adminstrator for each plan for a distribution of your funds. You should either receive the necessary papers or an explanation on why you can't obtain your funds.

2. Read the Summary Plan Descriptions (SPD)for the plans. These should have been provided to you when you first became a participant. If you never received these documents or they have been misplaced, request another copy from the Plan Administrators. The SPDs should provide the distribution rules.

3. If all else fails, contact the local office of the U.S. Dept. of Labor - Employee Benefits Security Administration. They should be able to help you if you do not receive responses from the Plan Administrators.