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Frequently Asked Question

How frequent is my employer suppose to provide participants with account statements on directed retirement plans like a 401k?

Answer: Your employer must provided statements quarterly for participant-directed individual account plans and annually for all other individual account plans. The Department of Labor says that participant statements should be provided no later than 45 days after the end of the quarter.

The statement must include, among other information, the following:

  • An explanation of any limitations or restrictions on the individual's rights to direct an investment;
  • A plain English explanation of the importance of a well-balanced and diversified investment portfolio for the long-term security of participants and beneficiaries, including a statement of the risk that holding more than 20% of a portfolio in the security of one entity (such as an employer's securities) may not provide adequate diversification; and
  • A notice directing the participant or beneficiary to the Internet website of the Department of Labor for sources of information on individual investing and diversification.

This is for educational purposes only. The information provided here is intended to help you understand the general issue and does not constitute any tax, investment or legal advice. Consult your financial, tax or legal advisor regarding your own unique situation and your company's benefits representative for rules specific to your plan.


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