Related: DOL wants 'excessive' details from firms for its new 401(k) 'lost & found' database: ERIC

The survey, sponsored by Inspira Financial, looked to assess which of these policies plan sponsors have adopted and other policies companies have in place around these issues. The survey received responses form 236 plan sponsors of varying sizes and industries and revealed that polices tend to vary greatly by plansize with small organizations more likely to keep balances in the plan indefinitely, and larger companies more likely to roll money over to an IRA. Key findings from the survey include:

A quarter of plans allow participants to keep funds in the plan regardless of the balance, though small companies are more likely to do so (38%), with nearly half of plans cashing out balances less than $1,000 (47%).
Small plans are more likely to keep balances from uncashed checks in the plan (60%), whereas large companies are more likely to place those funds in a forfeiture account (71%).
Less than half of plan sponsors (43%) have a formal written policy regarding missing participants.
A third of organizations use an outside search provider to help track down missing participants.

Small balances in the plan from terminated employees can have an impact in multiple ways. It can become an enforcement issue with the DOL as they check to make sure plan sponsors are getting terminated vested participants their money. Managing small balances also comes with increased costs — plan administration fees, searches, and more. Tracking down previous employees can drain resources and create an administrative burden as your team deals with tracking down these employees and dealing with returned mail.

Instant Insights /

Tracking down missing participants: A 'pain point' for retirement plan sponsors

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