Non-Vested Assets in retirement accounts

[conniebird]

I have a decent amount of non-vested money in my 403b from a generous match from my employer. I need to stay there for 6 years to be fully vested (graduated vesting schedule starting at two years of employment). I'm at one year now so 0% of their contributions is vested now.

I'm thinking that until the money is partially vested I shouldn't count it as part of my asset allocation as a whole (also have funds in Roth and 457b) - thoughts?

2nd question - I have about $1000 from a required defined contribution plan. Where should I roll it over to? It's pre-tax money so I think I can roll it over to my 403b.

Thanks in advance !!

[jfoxcpacfp]

1. I would not include it in a calculation of your total assets. As for allocation, do you mean % to stocks, bonds, etc?


2. If your 403b accepts rollovers from other plans (not all do) and you are happy with it, then roll it in. Another option is to roll it into your Roth IRA and pay the taxes. Of course, you can also r/o to an IRA but you will have to pay taxes on any backdoor Roth contributions.

[Hatton]

If you have a "decent" amount of non-vested money with your employer that is a very good reason to stay put for at least 6 years.

[kiddoc]

Hoping to revive this thread with a bit of a spin and throw in some contract negotiation....

Work for a large (50+) private group. Due to planned restructuring of retirement benefits/provider, there is an amendment to current contract we are asked to sign that includes 401(k) profit sharing plan with employer contributions up to IRS limit and 5 year vesting schedule. Given distinct possibility that I may be unable to remain with group for that duration (maybe only 2 years), wondering if there are reasonable alternatives to ask for to receive at least a portion of that benefit in excess of the 20-40% that would be vested by then. I understand part of the reason for structuring with such a vesting schedule is with the intention of increasing retention, but would still like to explore options. Any advice for alternatives to propose (cliff vesting 100% at 3 years, exchange for salary increase, other)??? Admittedly would probably be a hard sell for a large group to cut individual deals.

[Tim]

I don’t think a plan amendment can be individually tailored.
What are the plans current vesting?
What happens if you don’t sign?
Sounds like your last sentence is spot on unless the group collectively backs one of your proposals.

[JBME]

for what it's worth, perspective matters. if you are unable to alter the arrangement, there are plenty of places where the vesting schedule isn't gradual but rather all or none. I've been in situations where the vesting was 3 years. If I worked for 1094 days and then left or was let go, I'd get 0% of the matching money

[jfoxcpacfp]

Wouldn't it be uncomfortable to tell them now that you're leaving in 2 yrs? It just seems to me they won't have much incentive to negotiate that option with you, especially since it's $$ that will stay in the plan when you leave.

[kiddoc]

Thanks for thoughts and perspective, all. As I expected, sounds like from business owner's perspective asking for an individual deal would be a no go unless approved for all. I was hoping that others might have experience in proposing alternative benefits, one that would not make a significant difference to the employer but would to me. But as was pointed out, such a scenario doesn't exist since any added benefit to me would imply added cost to employer, which they would have little incentive to negotiate on. And agree with the sentiment that bringing up a 2 year exit with employer is not a good idea... which is why I haven't.