It’s Been 3 Years Since My Father Passed. His 401(k) Is Still Out of Reach

Losing a parent can be a tough blow. But one thing that can make things even harder is having to fight to get your hands on the assets you know they would’ve wanted you to inherit.

This Reddit poster seems to be in that unfortunate situation. Their father passed away and left a 401(k) plan behind. But they can’t get the institution holding that 401(k) to release the funds.

Worse yet, because they don’t have access to that account, they don’t have a way to even know how much it’s worth. So they’re not sure if it even pays to hire someone to help them get the money out.

I really feel for this poster, because it’s hard enough losing a loved one. They shouldn’t have to go through a huge hassle to get their inheritance.

That said, with better planning, this situation could’ve potentially been avoided. And it’s one everyone should take a lesson from.

It’s important to plan ahead

Accounts like 401(k)s allow holders to designate a beneficiary — someone who will inherit the account upon their passing. It’s generally possible to designate more than one beneficiary.

In this situation, had the father listed their child as the beneficiary of their 401(k), they’d perhaps not be in this frustrating situation.

Now if there’s no beneficiary listed on the 401(k), the next best bet is probably to see what the father’s will said. If the will listed the child as the primary beneficiary of the estate, that could make it easier to get access to the 401(k). But if the father never had a will, it introduces a whole new layer of complication.

That’s why estate planning is so important. Without taking the proper steps, anyone could wind up in a situation like this where a child should inherit assets but can’t get their hands on them.

Have open conversations

Of course, here, the child is operating under the assumption that they have the right to their father’s 401(k). That may be a correct assumption — meaning, that may be what the father would have indeed wanted. Or it may not be. It’s unfortunate that they can’t go back in time and have that conversation.

So there’s a lesson to be learned from all of this — have open discussions about inheritances as a family. It’s not a comfortable topic to discuss, and there’s really no getting around that. But having those uncomfortable conversations could spare someone a world of aggravation and heartache later.

It’s also a good idea to sit down with a financial advisor and estate-planning attorney as a family. These professionals can help you map out a plan so that assets are transferred according to everyone’s wishes.

For now, the poster above may have to consult an attorney if they’re being stonewalled by the financial institution holding their deceased father’s 401(k). An attorney should be able to tell them what information they need to provide to get that money released, since it clearly can’t benefit an account holder who’s no longer around.