Keeping a 401k that's not fully vested and hoping for plan termination

Has anyone personally had experience with keeping an old 401k that they were not fully vested in employee match, but having the fortune that the plan was terminated and became fully vested?

Background: I have a 401k from an old job I was only at about 10 months. In that time I became 50% vested in the employee match. With it being a relatively small amount overall < $7000 I decided to keep it there as it just pained me to lose any match even though it was only about $1500. I doubt I’d ever be back to reach the 100% vested threshold, but it’s not totally out of the question.

My best hope is that they terminate the plan for whatever reason and I become fully vested and I can take out my money.

Has anyone had personal experience/luck with this happening? Is this scenario so rare or unlikely that I’m better off taking the money and putting it into a fund I actually like?

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So I’ve done this twice now when leaving 2 different employers where I decided to leave the 401k alone rather than rolling over to an IRA or to my new employer’s 401k. Both times, the employer removed, at the end of the plan year, any money that I wasn’t 100% vested in.


Also when they remove what’s not vested at the end of the plan year, if your overall value falls below 5k, I believe they can force you out of the plan…that may vary based on the plan terms but I believe I’ve read that somewhere.

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Seems unlikely. I had a plan (spouse actually) that was not vested. Money un-vested was removed after separating (after some time). As @zzz mentioned, after a year or two, we received a letter that we had to move the plan. Moved it to Vanguard pretty easily.

Hope this helps.


Your 401(k) plan documents should specify when non-vested contributions are forfeited after leaving the company. In my case, it’s five years.

Then, calculate the opportunity cost of leaving your money there vs rolling it over. I would think that’s basically the expense ratio of the funds you’re invested in vs what you would invest in if you rolled it over. Then, decide if the likelihood of you getting those contributions in the future (i.e. returning to the company prior to forfeit, the plan terminating, or some other occurrence) is worth that cost.

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I think there’s no harm in keeping it there. I have heard of people getting inaccurately vested and getting to keep the money, including if they appeared to have “stayed” with the company long enough even tho they had left. It’s a small option on “a company error in your favor” happening, and as long as the investing options aren’t super pricy, it’s a free option too.


If they don’t force you out, and don’t charge you fees to stay in, you may as well just leave it and hope for the best. Like @doveroftke mentioned, the plan documents will likely give you a hint on what will happen. Many places that don’t charge a fee while you are employed, but let you keep the money in after you are no longer employed, will start to charge the fee. Keep that in mind when making your decision.