Unclaimed Money: What to do When a Good Account Gets Forgotten

Who forgets money? Sure, we’ve all lost a twenty dollar bill or even an uncashed birthday check from Grandma in our lives, but an entire financial account? Who misplaces or overlooks something that important?

Actually, it happens more often than you might think.

In 2015, state governments collected nearly $8 billion in unclaimed monies, according to the National Association of Unclaimed Property Administrators (NAUPA).

In every state, after a financial account has sat untouched for three to five years—and the administrating financial institution or brokerage firm has done its best to contact the account owner—the state can take possession of the money through a process called “escheatment,” according to the Securities and Exchange Commission. The account owner then has to go through the state to reclaim the money, assuming he or she ever realizes it’s missing.

You might forget a financial account for any number of reasons. It could be an employer-sponsored retirement account that you forgot about when you switched jobs. Perhaps you opened the account to qualify for a credit card deal, then forgot the underlying account existed. It may be one a relative opened in your name as a gift the day you were born, and your parents simply never mentioned it existed.


You can probably envision how thrilled you would feel to discover forgotten money, but take a moment to imagine how that neglected account might feel.

What might it say to you, the owner who left it behind?

  • “Hello, I’m the 401(k) that came with your very first job out of college. You never put very much money in me and when you left that job after just a couple of years, you didn’t bother to do anything with me. I’ve been lingering here, neglected for years, accruing a paltry interest.”
  • “I’m that brokerage account you opened when you decided to dabble in the stock market. You had your fun with me for a while, but I’ve been lonely and unused for years. Guess you weren’t in it for the long haul.”
  • “I’m that UTMA that your grandpa set up for you because he wanted to leave you a college gift. He would want you to have me to help make your life better. But you have done zilch so far with me. I’m still sitting in cash!”
  • “Hey! I am over here in a foreign jurisdiction. Just because I’m not in the United States, don’t think you can just ignore me forever. Eventually the IRS will track me down.”
  • “Hi, you set me up for your children’s college education. But you’ve done zilch with me since setting me up. Not only do I need periodic pruning and tweaking but I need additional cash. Have you heard how much it costs to go to college these days!”

Or, perhaps your neglected account is one you’re aware of but have intentionally overlooked because of confusing and complicated tax implications: “You just don’t understand me. I don’t fit into your financial plan.”

Your neglected account may fall silent for a while—years, even. But sooner or later, it will likely come knocking on your door, especially if it’s a retirement account. “Happy birthday! You’re 72. Time to start withdrawing funds from me or you will face tax penalties.”

So how should you deal with unclaimed money?


People find out about neglected accounts in virtually as many ways as they originally misplaced the accounts:

  • A relative may make an offhand mention of an account Grandpa opened for you when you were 10.
  • A parent may get tired of receiving account statements in your name, even though you haven’t lived with them in decades. Multiple address changes may leave a trail of breadcrumbs. A parent may bundle all the breadcrumbs together and forward them to you for a confusing surprise.
  • A diligent financial institution may finally track you down (it’s their responsibility to do so if a dormancy period is triggered).
  • Or, you may plug your name into a state database and find you’ve “hit the jackpot.” In fiscal year 2015, states returned $3.235 billion to owners, according to NAUPA.
  • California’s Unclaimed Property Program is pretty easy to navigate, and Californians can perform unclaimed property searches here.

Once you discover you have a dormant or neglected account, the first thing you should do is obtain a statement for the account.

If escheatment has already occurred, you’ll have to go through the state’s process to reclaim the account.

If the administrating financial institution still has the account, they’ll be able to advise you on the process of claiming the account through them.

Next, take steps to incorporate the neglected account back into your financial plan (if it’s big enough to worry about). The type of the account, the amount in it and your personal tax situation will be important details. Consult with your financial planner on the best course of account for the money; certain types of accounts, such as tax-advantaged or tax-deferred retirement accounts, may have tax implications that you’ll need help navigating.

With a little bit of attention, you can get reacquainted with your neglected account and begin collaborating again to make your money work toward your financial goals.

“Ahh. It’s good to see you again. You had me at hello!”


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