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Is a Rollover into an IRA the Right Move for You as a DoorDash Employee?

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Choosing an IRA rollover means that your money remains tax-advantaged and capable of growth, as in a DoorDash-sponsored plan. You may also gain more investment options than what may have been available in your DoorDash-sponsored plan. You may also gain oversight of managing these important retirement assets from your trusted Advisor.

If you roll your retirement plan assets over into an IRA account that you already own through your Advisor, you also receive the benefit of combined statements and holistic investment planning, making it easier to track your overall financial situation.

'Receive the benefit of combined statements and holistic investment planning, making it easier to track your overall financial situation.'

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Some of the benefits of rolling your money into an IRA include:

Tax-deferred growth potential: This generally avoids current income tax and distribution penalties when removed from a DoorDash-sponsored retirement plan.

More investment choices: This allows for additional contributions, if eligible. IRAs can be combined and handled by one provider, thereby reducing trustee costs and consolidating statements. Protection from creditors in federal bankruptcy proceedings. The combined amount of your required minimum distributions (RMDs) can be taken from any of your Traditional, SEP or SIMPLE IRAs.

However, there are also some important considerations that DoorDash should make before rolling over their money into an IRA, these include:

Internal management fees might be higher than in a DoorDash-sponsored retirement plan.
Fees and expenses depend largely on the investments you choose.
Loans from an IRA are not allowed.
Early distributions may be subject to a 10% IRS tax penalty in addition to income tax.
RMDs begin April 1 following the year you reach 70½ and annually thereafter; leaving the money in the former Fortune-500 plan may allow RMDs to be delayed until separation from service.
IRAs are subject to state laws governing malpractice, divorce, creditors (outside of bankruptcy), and other lawsuits; leaving the money in the former DoorDash-plan may provide additional protection against creditors.
Net unrealized appreciation (NUA) is the difference between what you paid for employer securities and their increased value. You lose favorable tax treatment of NUA if the funds are rolled into an IRA.

Hopefully, these insights will be helpful as you plan your retirement from DoorDash.

For more information about this topic, view our e-book here: https://retirekit.theretirementgroup.com/will-your-retirement-plan-retire-with-you-e-brochure-offer

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What is the 401(k) plan offered by DoorDash?

The 401(k) plan at DoorDash is a retirement savings plan that allows employees to save for their future by contributing a portion of their salary before taxes.

Does DoorDash match employee contributions to the 401(k) plan?

Yes, DoorDash offers a matching contribution to the 401(k) plan, which helps employees grow their retirement savings faster.

How can DoorDash employees enroll in the 401(k) plan?

DoorDash employees can enroll in the 401(k) plan through the employee benefits portal during the enrollment period or after they become eligible.

What are the eligibility requirements for DoorDash's 401(k) plan?

To be eligible for DoorDash's 401(k) plan, employees typically need to meet certain criteria, such as being a full-time employee and reaching a specific duration of employment.

Can DoorDash employees change their contribution percentage to the 401(k) plan?

Yes, DoorDash employees can change their contribution percentage to the 401(k) plan at any time through the employee benefits portal.

What investment options are available in DoorDash's 401(k) plan?

DoorDash's 401(k) plan offers a variety of investment options, including mutual funds, target-date funds, and other investment vehicles tailored to different risk levels.

Is there a vesting schedule for DoorDash's 401(k) matching contributions?

Yes, DoorDash has a vesting schedule for its matching contributions, meaning employees must work for a certain period before they fully own the matched funds.

How can DoorDash employees access their 401(k) account information?

DoorDash employees can access their 401(k) account information online through the designated retirement plan administrator's website.

What happens to a DoorDash employee's 401(k) if they leave the company?

If a DoorDash employee leaves the company, they can choose to roll over their 401(k) balance to a new employer's plan, an IRA, or cash out, subject to tax implications.

Are there any fees associated with DoorDash's 401(k) plan?

Yes, there may be administrative fees and investment-related expenses associated with DoorDash's 401(k) plan, which are disclosed in the plan documents.

With the current political climate we are in it is important to keep up with current news and remain knowledgeable about your benefits.

I found information about DoorDash's employee benefits, including details on their 401(k) plan. DoorDash provides a 401(k) plan for its employees, which includes a matching contribution of 2% of the employee's salary. However, DoorDash does not offer a traditional pension plan. The 401(k) plan is the primary retirement savings vehicle, and employees are eligible to participate once they meet specific criteria, typically after one year of service. The sources reviewed did not provide a detailed pension formula or specific company acronyms related to retirement plans, as DoorDash seems to focus more on its 401(k) offerings rather than traditional pension plans. The information was gathered from DoorDash's official resources and employee reviews on benefits websites

In 2023, DoorDash announced layoffs affecting approximately 1,250 employees as part of cost-cutting measures due to economic challenges. The severance package includes 17 weeks of pay and extended health benefits. Additionally, DoorDash is piloting a portable benefits savings program to help workers manage health insurance and emergency savings, indicating shifts in how the company approaches employee benefits. This restructuring reflects broader economic pressures, highlighting the need for companies to adapt their financial strategies amid changing market conditions.

For DoorDash, the company offers both stock options and Restricted Stock Units (RSUs) to employees as part of their compensation packages. The company's stock options are often granted with a four-year vesting schedule, and the RSUs generally vest over a similar period. Eligibility for these stock options and RSUs is typically limited to full-time employees, including executive-level positions. In 2022, DoorDash continued to offer these benefits, with notable grants to key executives. The same trend persisted in 2023 and 2024, with some adjustments to the vesting schedules and the value of the stock options and RSUs reflecting the company's stock performance during these years.

Health Insurance Stipends: Under California's Proposition 22, DoorDash provides healthcare stipends to qualifying Dashers based on their active hours. For instance, those averaging 15 to 25 active hours per week receive $735 per quarter, while those exceeding 25 hours receive $1,470. This stipend is part of their effort to ensure that Dashers can access health insurance despite being classified as independent contractors. Portable Benefits Program: In 2024, DoorDash launched a pilot program in Pennsylvania, introducing a portable benefits savings plan. This program allows eligible Dashers to allocate a portion of their earnings toward health insurance, retirement savings, and paid time off. The portability of these benefits is designed to cater to the flexible nature of gig work, ensuring that workers can maintain their benefits even as they move between jobs. Merchant Health Benefits Initiative: DoorDash has also expanded its focus on healthcare benefits for employees of its restaurant partners. The "Merchant Benefits & Discounts" program, launched recently, offers discounted healthcare, mental health services, and other resources to small businesses. This initiative is aimed at helping restaurants attract and retain staff by providing access to affordable benefits typically available only to larger companies. Collaboration with Stride Health: DoorDash has partnered with Stride Health to assist Dashers in selecting and managing their health insurance plans. This collaboration ensures that Dashers have access to personalized healthcare options that fit their needs, further supporting their independent contractor workforce with essential benefits.

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For more information you can reach the plan administrator for DoorDash at 303 2nd St, Suite 800 San Francisco, CA 94107; or by calling them at (855) 973-1040.

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