How to Help Clients Get Rollover Checks to Custodians

Here are Jeff's tips on getting Rollover Checks to Custodians!

You can have the client mail directly to the custodian, assuming they can be diligent about labeling the envelope or package and including their return address. The only thing to be really careful about is use the overnight delivery address only for overnight packages via UPS/FedEx/USPS; and the mailing address only for slower 1st class or priority Postal Service. Don’t carelessly interchange those different addresses without expecting trouble.

It’s common for advisors to pre-print labels, attach to a self sealing envelope, and hand the whole thing to the client (or mail to them) in advance so they’re ready to go when the check arrives. I think the prepared envelope option is a must, and include tracking on the shipment for sure. The custodians do lose these from time-to-time and it’s nice to be able to show them precisely who signed for it so you have proof it arrived. FedEx and UPS will both allow you to print print a label fully addressed as needed from their websites.

Both are clunky, but you can manage it. USPS hasn’t historically allowed preprinted labels (unless it’s changed recently), but you definitely could preprint USPS labels using Stamps.com. Note that the biggest consideration here is which services are readily available/accessible to your clients to hand off the package when it’s ready. I’ve had some rural clients where a FedEx or UPS dropbox is 40 miles away, so USPS might be your only option in those cases. I’ve never messed with scheduling pickups, though, from UPS or FedEx. That could be an option. But, in any case, some clients won’t ever get around to it if it’s not easy. Some Rollovers can be directed straight to the custodian as well. The administrator of the 401k decides whether or not that’s an option, though.

(Author: Jeff Snodgrass 01.24.24)