Keep the Account Open

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The Participant may elect to keep the account open and as part of the plan. ($5,000 and above account balance.) 

If the account balance is $5,000 or above, the final decision with regards to the future disposition of the account rests with the Participant and not the Plan Sponsor.

Most Plan Sponsors prefer to have terminated Participants exit the plan. Otherwise, the Plan Sponsor has the ongoing administrative burden associated with assuring that the former employee receives all of the required Plan communications to include Summary Plan Descriptions, required notifications and others.