Don’t lose the wealth you have gained because you failed to pay attention to alerts from your stock investments. Diversity is the key to our ultimate success. We often get so distracted running the portion of our business having to do with our real estate holdings that we forget to pay attention to our other investments.
States looking to beef up their accounts are becoming much quicker to declare investments “abandoned” when investors lose contact with their financial institutions. According to AARP, “States held $41.7 billion in unclaimed financial assets such as bank accounts, uncashed paychecks and securities as of 2011.” That is a tremendous amount of potential loss for individuals and families.
Escheatment is the process that requires financial institutions to report and remit abandoned and unclaimed funds including financial assets. This protection is in place to protect consumers and create transparency in the financial institutions. Assets can be considered abandoned if the investor hasn’t contacted the financial institution for three or five years. Note that setting up recurring activity such as dividend reinvestments, recurring investments or setting recurring deposits do not count as owner-initiated activity by most states.
Here are some guidelines to make sure this doesn’t happen to you. Develop an annual checklist to review your accounts. Assure that your contact information and your beneficiaries are accurate. If they cannot contact you, because of an incorrect mailing or email address, they could consider the account abandoned.
This process allows you to review your status and/or your desires for these funds. Use this time to build an information sheet to be available for family in the case of your debilitation or death.
Attend immediately to letters that come regarding your account. Prior to an account being designated as abandoned, the company will contact you at the last known address. Don’t panic if you get one of these, instead act quickly. If you worry that the letter is a scam go back to your last mailed statement and call from that number.
Failure to respond to their initial contact will result in a signature required letter. This normally happens after it has been moved into abandoned status. Make contact immediately. Once you contact them regarding this matter, they will begin the process of moving it out of abandoned status. You must follow up! The process is not complete until you confirm with them that your funds are now back in your account.
Every bump in the road is an opportunity to learn and become expert in investing. Take advantage of this new knowledge and share it with your fellow investors and private money lenders. Who knows, the next source of funding your deal could be the money you saved from abandonment!