Although no one wants to lose track of their money, it happens to most of us at some point or another. We forget about an old checking or savings account and don’t realize until years later. If you have an inactive account that’s been closed, you may be wondering if there’s a way to claim the remaining balance.
Luckily that money isn’t gone forever and can be retrieved by following a few simple steps. Here’s everything you need to know about how to claim money from a dormant account.
What Is a Dormant Account?
A dormant account is one that hasn’t been active for a long period of time, usually three to five years. To keep an account open, you need to use it every now and then by withdrawing or depositing money. If you haven’t touched one of your bank or brokerage accounts in a while, another way to make sure it stays active is to contact the financial institution and let them know you still want to keep the account open.
But sometimes we forget to stay on top of our accounts, which may cause them to become dormant. Your bank is required to try to contact you to discuss your account status. However, if you’ve moved around a lot or haven’t updated your contact information, they may not be able to get ahold of you.
In that case, any money that’s left in the account will be sent to the state treasury department for safekeeping. But luckily you can still get it back at any time as there’s typically no statute of limitations on claiming money from a dormant account. Here’s how to retrieve your funds.
How to Claim Money From a Dormant Account
To get money from a dormant account, you’ll have to contact your state’s treasury department, not the bank. You can find their contact information on a website called MissingMoney.com. It’s a database that helps you find unclaimed money from dormant accounts, insurance policies, CDs that have matured, uncashed checks, and more.
You can use MissingMoney.com to search and find out if you have any unclaimed funds from inactive accounts. However, the database isn’t 100% complete, so you’ll get the most accurate results by contacting your state’s treasury department.
To claim your funds, you may need to prove the money is yours by providing identification. Once you show you’re the rightful owner of the account, your money will usually be sent to you in the form of a check in the mail.
Tips On Avoiding Dormant Accounts
If you let your bank account become dormant, some financial institutions will charge you a monthly inactivity fee until your cash is turned over to the state. The fee is usually $5 or $10 per month. Although that seems small, it can really add up and drain your funds over time.
Your bank may even charge you a fee for sending the money to the treasury department after a few years have elapsed. This is called an escheatment fee and typically ranges from $20 to $50.
These two charges can cause you to lose a lot of the money in your account. So it’s important to keep track of your bank accounts and never let them lapse. One app that may be helpful is Mint. It allows you to manage all of your accounts on a single platform so you don’t forget about them.
You can also set up automatic payments so your account always has some activity. That way you don’t need to remember to use it to keep it from going dormant.
It’s also important to keep the contact information on all of your accounts updated. That way if the account does lapse, the bank will be able to get in touch with you before the money gets sent to the state.
If you have multiple bank and brokerage accounts, it can be hard to keep track of them all. But it’s definitely worth it to stay on top of your finances so you don’t have to go through the hassle of retrieving your money from the state.
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