Smart Money: Finding remnants of old 401(k)

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DEAR BRUCE >> About 30 years ago, I worked for Kmart Corp. full time for nine years. I invested in the 401(k), but quit before I was fully vested at 10 years. Upon leaving, I received a check for a few thousand dollars, which I thought was the balance of my investment.

Social Security recently notified me that I have $6,400 in a retirement account with Kmart Holdings. Sears Holdings now owns Kmart, and I have been trying to contact someone (by letter) to confirm and pay or deny the monetary balance. I'm getting the runaround. How do I get an answer?

— Retired

DEAR RETIRED >> Since you heard from Social Security that you have $6,400, that's the place to begin, it seems to me. I don't mean talking over the phone. Make an appointment to go in person with all the information you have, including any correspondence, etc. It may take a little bit of time, but the people who notified you about the money should be able to follow through.

DEAR BRUCE >> We are in our mid-70s. We downsized from a large property that we purchased in cash. We have $90,000 in profit that is sitting in a savings account.

We didn't do well with our investments in the last 10 years. We thought we had a large, competent financial organization tending to our monies, but along the way, we felt we lost money unnecessarily.

My husband wants to keep the money safe in a savings account. I want to see it generate some income, without the risk. What do you suggest we do? We will need to draw from it in two years for living expenses, unless "surprises" happen, such as health, etc.

— S.A.

DEAR S.A. >> The fact that you lost some money in the market shouldn't discourage you from still investing. Check very carefully the credentials of your adviser or broker. With the appropriate investigations, 5 percent is not at all an unrealistic return to expect.

From time to time, look over your account, but resist taking money out or shifting it around regularly. This is a case where patience is the best way to go. You might want to set something like a 10 percent loss limit. In other words, at $10,000 you're out!

At the very least, re-examine your investments. Keep in mind that over a period of time, they are going to be OK.

Send questions to bruce@brucewilliams.com. Questions of general interest will be answered in future columns. Owing to the volume of mail, personal replies cannot be provided.


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