What is a vesting schedule?

What is a vesting schedule?

Vesting refers to how much of your retirement account you own.

• You are always 100% vested in:
  • Your own contributions
  • Any rollovers from other retirement accounts
• Employer contributions may vest over time, depending on your plan’s vesting schedule.

A vesting schedule determines when you earn ownership of employer contributions and any related earnings.

Examples:

• 20% vested after each year of service (20%, 40%, 60%, etc.)
• 100% vested after 3 years of service (often called “cliff vesting”)
• Immediate vesting (common in Safe Harbor plans)

If you leave the company, your vested percentage is locked in as of your termination date.
For example, if you are 40% vested when you leave, you keep 40% of the employer contributions. The remaining unvested portion is forfeited.

For specific vesting details of your plan, contact us at (888) 736-4015.