Suppose that I already maxed out my 401k at my current company and got $9k matching from the company. Now I quit and join a different company, continue max out and get another $8k in the new company in the same year. I understand that the broker, like Fidelity, will return my next exceeded contribution later. But what happens to the $8k matching from the new company? Can I keep it? Anyone tries this?
You’re allowed to contribute 19k per year to 401k pre-tax but the limit of 401k is 56k. This means you can get up to 37k of employer match (or Roth in plan conversions on after-tax 401k if you want to get fancy)
What happens if I already max out the $56k limit through the after-tax contribution?
Then you cannot contribute anymore. Thats when you open a normal brokerage account like the rest of the plebs and invest . Also how do you live ?? You max out your HSA, 401k, roth ira, after tax 401k ?
Will they match it in the first year ??
Depend on company policies, but yes for most.
No, you cant. The match was done on ineligible contributions.
As far as I know you get to keep the match and the excess that you contribute will come back to when you file taxes the following year.
Once you've got both the 19k limit on and the 56k maxes you're looking at after-tax vehicles like IRA, Roth IRA, SEP IRA. If you can prove to the IRS that you have a side hustle or have any kind of freelance income the SEP IRA has the highest annual contribution limits of the three
I’m confused... can someone help clarify? So let’s say OP gets the employer max match at first company. And has matched the federal 19k limit. Are you saying the new company will be able to match again via backdoor?
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