[TDoggett]

I'm having a hard time understanding my statement. I've asked my employer and have asked the rep for my 401k company but I still don't get it. My most recent statement shows my ending balance and my current vested balance. These two numbers are different from one another. What's the difference between the two? My ending balance is about $700 more than my vested amount.

Can someone please explain this to me?

[ebaines]

The vested amount is less than the ending balance because your plan has a "vesting schedule," which means that the matching contributions they make into your account really isn't really yours until have a certain number of years working for the company. So the vested amount is less than the "balance" until you have met the requirements to be fully vested. The specifcs of how your balance vests depends on the specific rules set by your company. Perhaps an example will help: the plan at my work, has a vesting schedule that says 20% vests after 2 years, 40% at 3 years, 60% at 4 years, 80% at 5 years, and 100% at 6 years. This means that until I reach 6 years employement with this company, if I leave I will only get a perecentage of the amout they have added to my account. Once I get to 6 years I will be fully vested, and if I leave after that I can take the entire balance with me. Again, plans vary, so ask your HR department to explain the vesting schedule to you. One other thing - this vesting only aopplies to the money your company contributes to your 401(k) account - the money you put in from your salary and its earnings are all yours.

[InquiringMind_1]

I glad this answer was available. I was thinking my former employer was trying to mess me over again.