What are my options for leaving a job with a Simple IRA within the 2-year period?

Question

I have a Simple IRA through my employer that currently has ~$3,000 in it. While this account was opened over two years ago, my understanding is that the 2-year period for SIMPLEs starts with the first contribution, which was only one year ago. I am not likely to stay at my current company for the next year (when the 2-year mark would be satisfied), so I'm trying to plan the best course of action to minimize loss of money.

I've been reading around and understand the steep penalties I'll face if I try to move this money. Since I'm not likely to move to another employer that offers a SIMPLE IRA, am I correct in thinking that my only viable option to not lose a lot of money is to keep my funds where they are until I've met the two-year mark? At that point I could roll it over into a new employer's 401(k) or another kind of account.

If so, my main question becomes: can my current employer simply decide to terminate my account after I've left and cut me a check? Is there anything I can do—aside from not burning any bridges and asking nicely—that would prevent this? This article claims an employer can terminate a retirement account with less than $5,000, but I can't find any other sources that corroborate that and SIMPLEs aren't mentioned anyway. I've read the rules for terminating SIMPLE plans, but that seems more about the company's entire plan rather than an individual employee's.

Basically: considering I definitely want to change employers in the next year, what's my best course of action for minimizing the loss of my SIMPLE balance?

Related question: Options for a Simple IRA when leaving a job: Leave as is or roll it over?, except I don't have the option of rolling over right now

Answer 1

Your Simple IRA account is yours and yours alone, not your employer's.
The only thing your employer can do with it is putting more money into it.

The best option is to simple let it sit for the two years, and then either:

1. Let it sit forever, as it doesn't turn bad, until you are old and want to use the money, or
2. Roll it over into another account, at the same or another provider, into either a another simple IRA, a Traditional IRA, or a ROTH IRA; for consolidation, or because you prefer another type of account.