Dylan Handy's experience highlights significant vulnerabilities in the retirement rollover system, emphasizing the ongoing reliance on physical checks by plan administrators. Despite the prevalence of technology, a substantial 43% of individuals still encounter paper checks for 401(k) rollovers. Handy's legal battle with Paychex underscores the frustrations of many savers, who often face fraud risks, delays, and a lack of transparency when moving funds. The industry retains outdated methods due to legacy systems and regulatory issues, urging a need for standardized electronic solutions to safeguard retirements.
This outdated and insecure method remains standard practice in the retirement industry.
Americans are running out of patience. More than 80% of savers say rolling over a 401(k) should be as simple as making a bank transfer.
Paper checks in 401(k) rollovers expose savers to serious risks.
In Hardy's case, he's now in federal court suing Paychex after months of getting nowhere with banks and no reimbursement for the bulk of his lost savings.
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