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I took a new job in early April. At the new job they do not use fidelity and that's what my old job used. The process is kind of more involved than I thought it would be and has not been done yet. I have papers i have to get notarized, DH has to sign them as well, then I have to mail them back in. I currently have the papers in hand but have not gotten around to find a notary so DH and I go there and have them sign with us.
In the meantime it just dawned on me that I can probably just open the new 401k at my current company, start contributing and wait for my old 401k to get rolled in? I dont think I have to wait for the old 401k to get moved in before I start contributing?
Most companies 401k plans will allow you to keep your money in your previous company's 401k program as long as you meet their minimum requirements. From what I recall it is around $5000 or 10k in the account. You should be allowed to open a new 401k with your current employer regardless of your previous 401k account status.
Yes it is ok for me to keep my money in the 401k with fidelity, but i'm not able to contribute anything to it from my new employer.
Is it common to just let a 401k sit there in one account then open a new one that you contribute to? So basically have two? One that you contribute to from your paycheck and one where you dont?
Is it common to just let a 401k sit there in one account then open a new one that you contribute to? So basically have two? One that you contribute to from your paycheck and one where you dont?
I would think it's pretty common, and there's nothing wrong with this except it's less convenient than having everything in one account.
There is no rush to transfer the old account into your new company's plan, as you can do it at any time. But once the money is with your new company's plan you cannot move it out until you leave that employer. So take your time and be really sure you like the investment selections in the new plan.
Yes it is ok for me to keep my money in the 401k with fidelity, but i'm not able to contribute anything to it from my new employer.
Is it common to just let a 401k sit there in one account then open a new one that you contribute to? So basically have two? One that you contribute to from your paycheck and one where you dont?
Your options are to 1) leave old 401k in Fidelity, 2) roll old 401k to new 401k, 3) roll old 401k to IRA. You definitely should have opened a 401k for your new job as soon as you can, at the minimum get the company match.
Based on what you said on another post if you need to do backdoor Roth in the future it's better not to have pre-tax IRA since they complicate the process when you convert. So leave it in old 401k if the fees and fund options are better than the new 401k, or roll it to the new 401k.
Thanks. So to confirm: I can open a 401K NOW with my new company and start putting money into it. Then i can STILL roll my old 401k into whenever i get the paperwork notarized?
Thanks. So to confirm: I can open a 401K NOW with my new company and start putting money into it. Then i can STILL roll my old 401k into whenever i get the paperwork notarized?
If yes I'm going to open the new 401k today.
Yes
If the new company's fund choices are good and with similar expense ratios, I would do as you describe, especially if you ever anticipate doing a backdoor Roth IRA.
If not, you will get a better selection keeping it in an IRA. Fidelity is an excellent firm to have your money at.
Pre-Tax per paycheck:
After-Tax (Roth) per paycheck:
i had to enter in two different percentages. Why? I didnt have to do that at my last job. They just asked for the amount i wanted taken out.
Also what percentage do most people have taken out? At my last job i put 5% but i dont think that's enough
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