Count your former US employers, then count the 401(k)s you still have with them. For many readers, the second number is higher than they would like.
An old account causes no problems while you live here. That changes when you move to India. Almost every fix below takes a morning from a US address. From an Indian address, some take months, and a few cannot be done at all.
The short version
Your old plan can move your money without asking. If the balance is under $7,000, the plan can roll it into an IRA (an individual retirement account) at a provider it picks. Under $1,000, it can mail you a check, and the IRS taxes that check whether you cash it or not. Most lost accounts go missing this way.
A foreign address can lock you out of a US brokerage. Every firm has its own rule, and almost none publish it. Some block new purchases, and some close the account. Ask yours now, while you still live here.
1. Find every account
Start at lostandfound.dol.gov. The Department of Labor launched this database in December 2024. It lists accounts that employers have reported as unclaimed.
Next, check your own records. Old W-2s show the employer, and old statements show the plan administrator. If someone bought the company, its benefits department can usually trace the plan. Search the National Registry of Unclaimed Retirement Benefits and your state's unclaimed property office as well.
Two dollar limits explain most missing money. A plan can push a balance under $7,000 into an IRA without your consent, at a provider it chooses. That IRA usually sits in a money market fund that earns little. SECURE 2.0 set the $7,000 limit in 2024, and it does not rise with inflation. For amounts below $1,000, the plan can mail a check. The IRS taxes it and adds a 10% penalty if you are under 59½, whether or not you deposited it.
Playbook Move: Search under every spelling of your name and every Social Security number you have used. US payroll systems often misspell Indian names, and a different spelling will not match.
2. Your four choices
You can leave it, roll it to an IRA, roll it into your current employer's plan, or cash it out. Each option works differently once you stop being a US resident.
Cashing it out is almost never the right choice. You will pay income tax on the full balance at your top rate, plus 10% if you are under 59½. The money permanently stops growing tax-deferred. On a $120,000 balance, the tax bill can exceed $45,000.
Rolling it into an IRA gives you the most control. It is also the step that gets hardest once you leave. Request a direct transfer from the plan to the IRA provider. If the plan writes the check to you instead, it keeps 20%. You then have 60 days to deposit the full amount, and you must cover the missing 20% from your own savings.
3. When your address changes
Every brokerage and plan administrator sets its own rules for clients abroad. Some keep your account open but stop new purchases, so you can sell but not rebalance. Some block mutual funds that are not registered for sale outside the US. A few will ask you to move the account.
Some large brokerages have separate international firms that accept clients in India. Open one before you leave. Opening one from India means more paperwork, more delays and more chances for rejection.
Your phone number matters too. Most US financial firms send login codes by text to a US mobile number. If you cancel that number, you could lose access to your retirement money. Getting back in usually requires US identification and a call during New York business hours, which is the middle of the night in Mumbai.
Keep the number. Before you cancel your US plan, move the number to Google Voice. Google charges a one-time $20 fee, and you must start the move while your mobile plan is still active. Google Voice runs over the internet, so it works from India. You can have it forward every text to your email.
It has two limits. Some banks and brokerages refuse to send codes to internet phone numbers. Texts from short codes (the five- or six-digit numbers firms use) sometimes never arrive. Google can also reclaim a number that sits unused for months. Make a call or send a text from it now and then.
Playbook Move: Before you cancel your US mobile plan, move the number to Google Voice and turn on text forwarding to email. Then log in to every US financial account and check that the code arrives. Where it does not, switch that account to an authenticator app before you leave. Ask each custodian in writing what happens to your account if your address changes to India, and keep the reply.
4. Consolidate while you still live here
Playbook Move: Consolidate now. Rolling three old 401(k)s into one IRA takes a morning while you still have a US address, a US phone number and US tax residency. Once you leave, every step takes weeks. The estate tax is the same whether you hold one account or four, but one account is easier for your family to claim.
The order to do it in
The steps above depend on each other, so the order matters. If your move date is set, work through them in this order.
- Search first. Check lostandfound.dol.gov, your old W-2s and statements, the National Registry of Unclaimed Retirement Benefits and your state's unclaimed property office, under every spelling of your name.
- Ask each custodian about an Indian address. Get the answer in writing. If the firm will restrict or close the account, you need to know before you choose where to roll your money.
- Open the account you will keep. If your brokerage has an international firm that accepts clients in India, open that account before you leave.
- Roll the old 401(k)s over by direct transfer. The money should go from the plan to the IRA provider, so the plan does not keep 20%.
- Move your US number to Google Voice. Start while your mobile plan is still active. Then test the login code on every account, and switch to an authenticator app where the code does not arrive.
Balances under $7,000 need the most attention, because the plan can move them without your consent. Balances under $1,000 can turn into a taxed check.
Moving the account is half of the job. The other half is tax. That means what the US withholds once you are a nonresident, how India taxes the account after you return, and the $60,000 estate tax limit. Those are covered in 401(k) tax after you return to India. If you are planning the whole move, see our returning NRI service, or book a tax consult before you give your custodian an Indian address.
From Edition 15 of the NRI Playbook newsletter. For informational purposes only; not financial, tax, or legal advice. For decisions about your specific situation, consult a qualified cross-border tax professional.