This video presentation is designed to give the viewer a basic understanding of Auto Portability.
What is Auto Portability?
Auto Portability is:
- The routine, standardized and automated movement of an inactive participant’s retirement account from a former employer’s retirement plan to their active account in a new employer’s plan.
- Serves the needs of participants subject to mandatory distribution provisions of their employer-sponsored plan (separated participants with account balances less than $5,000) to curb excessive cash out leakage occurring as participants change jobs.
- Could be adapted to larger account balances, should public policy dictate a higher mandatory distribution limit.
Why is Auto Portability needed?