Vanguard Expands Retirement Clearinghouse Eligibility to IRA Account Holders

The Vanguard Group has expanded its work with the retirement consolidation and portability firm Retirement Clearinghouse LLC for Vanguard’s individual retirement account holders, the firm said in a statement.

Vanguard is expanding a partnership it started in 2021 on 401(k) rollovers to now alert IRA account holders of forgotten or lost retirement savings.

“We have identified a population of Vanguard IRA accountholders who may have lost track of their retirement funds, which can occur when employees change jobs,” a spokesperson wrote via email. “We are proactively engaging these IRA accountholders to reconnect them with these funds.”

Charlotte, North Carolina-based Retirement Clearinghouse started in 2014 as a solution to retirement plan leakage from lost or forgotten participant accounts. In 2022, it started the Portability Services Network with the goal of getting recordkeepers to create a shared database. Vanguard, Fidelity Investments and Alight Solutions were early participants, and Empower Retirement, TIAA and Principal Financial Group have now also joined, bringing on the nation’s largest recordkeepers.

“Retirement accounts are sometimes left behind during a career transition or when a saver mistakenly feels an account is too small to be impactful toward their retirement goals,” Vanguard wrote. “This can lead savers to miss out on value from the money they have already set aside. Consolidating these funds can make it easier to keep track of retirement savings and tap the power of long-term investment returns, ultimately putting savers on their best path to investment success.”

With the expanded partnership, Vanguard will transfer lost IRA accounts to the Retirement Clearinghouse on an “as needed basis,” with the goal of reuniting and preserving retirement assets for account holders, according to the statement.

“Retirement Clearinghouse and Vanguard share the same mission to improve the retirement outcomes of under-saved and underserved participants by reducing cash out leakage though a program of facilitated consolidation of stranded or forgotten 401(k) accounts,” Retirement Clearinghouse said in an emailed statement. “Expanding our partnership to also include forgotten IRA accounts is natural extension of that mission.”

While the expanded partnership only involves Vanguard IRA account holders only, the clearinghouse is “certainly amenable to similarly structured relationships with other mission-aligned IRA providers.”

The clearinghouse’s services include a call center providing specialized assistance designed to enable end-to-end portability and account consolidation; uncashed check services; and the capability to search for lost and missing participants.

The firm works with more than 36,000 retirement plans and has worked with more than 1.9 million plan participants with more than $29 billion in retirement savings, according to the company that is part of the The RLJ Companies and was founded by Robert L. Johnson.