Can I still contribute to a 401k if I no longer work for the company?

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surfer949
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Can I still contribute to a 401k if I no longer work for the company?

Post by surfer949 » Wed May 25, 2016 8:28 am

I have a 401k from a company I worked for three years ago and it's not fully vested. Can I still make contributions to this 401k?

Da5id
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Re: Can I still contribute to a 401k if I no longer work for the company?

Post by Da5id » Wed May 25, 2016 8:30 am

surfer949 wrote:I have a 401k from a company I worked for three years ago and it's not fully vested. Can I still make contributions to this 401k?
Nope. You can roll it to an tIRA and contribute, or roll it into 401k of new employer (often bad idea) and contribute there though.

surfer949
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Re: Can I still contribute to a 401k if I no longer work for the company?

Post by surfer949 » Wed May 25, 2016 8:45 am

Da5id wrote:
surfer949 wrote:I have a 401k from a company I worked for three years ago and it's not fully vested. Can I still make contributions to this 401k?
Nope. You can roll it to an tIRA and contribute, or roll it into 401k of new employer (often bad idea) and contribute there though.
Does the money grow if it stays in the 401k? The reason why I'm asking is because I want to keep the shares of the company stocks and not loose them if I roll it over to a IRA.

clacy
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Re: Can I still contribute to a 401k if I no longer work for the company?

Post by clacy » Wed May 25, 2016 8:47 am

surfer949 wrote:
Da5id wrote:
surfer949 wrote:I have a 401k from a company I worked for three years ago and it's not fully vested. Can I still make contributions to this 401k?
Nope. You can roll it to an tIRA and contribute, or roll it into 401k of new employer (often bad idea) and contribute there though.
Does the money grow if it stays in the 401k? The reason why I'm asking is because I want to keep the shares of the company stocks and not loose them if I roll it over to a IRA.
I'm pretty certain you can keep it in your old company's 401k, you just won't be able to contribute further.

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rob
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Re: Can I still contribute to a 401k if I no longer work for the company?

Post by rob » Wed May 25, 2016 8:48 am

A few issues in here....
- Your contributions are always 100% vested.
- The employer match usually vests over time but if you have left, your not going to get those no matter how long you wait.
- You can rollover to an IRA within a brokerage account and still own shares in any listed company.
- Think about why you want stock - what do you know that's not known to the market? Why take on added risk?
| Rob | Its a dangerous business going out your front door. - J.R.R.Tolkien

surfer949
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Re: Can I still contribute to a 401k if I no longer work for the company?

Post by surfer949 » Wed May 25, 2016 8:59 am

rob wrote:A few issues in here....
- Your contributions are always 100% vested.
- The employer match usually vests over time but if you have left, your not going to get those no matter how long you wait.
- You can rollover to an IRA within a brokerage account and still own shares in any listed company.
- Think about why you want stock - what do you know that's not known to the market? Why take on added risk?
I didn't realize the 100% vested part. In that case I will roll it over to my Fidelity IRA. The only reason why I wanted to keep the stock is because the value just went up due to a recent company merger. Thx for the info :happy

Da5id
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Re: Can I still contribute to a 401k if I no longer work for the company?

Post by Da5id » Wed May 25, 2016 9:00 am

clacy wrote: I'm pretty certain you can keep it in your old company's 401k, you just won't be able to contribute further.
If it is more than $5000 you can leave it absolutely, less than that at employer's discretion as I understand it.

I'd tend to pull it out myself. But I also agree with above comment -- why do you think the old company stock is a better investment than the broader market?

minesweep
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Re: Can I still contribute to a 401k if I no longer work for the company?

Post by minesweep » Wed May 25, 2016 9:50 am

If the value of the stock went up because of the merger I would count my blessings and move on. JMO.

ERISA Stone
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Re: Can I still contribute to a 401k if I no longer work for the company?

Post by ERISA Stone » Wed May 25, 2016 9:56 am

rob wrote:A few issues in here....

- You can rollover to an IRA within a brokerage account and still own shares in any listed company.
For this statement to be true, the plan must allow in-kind distributions. Most plans that I have encountered are written to only allow cash distributions, so the account would have to be liquidated prior to the rollover.

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rob
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Re: Can I still contribute to a 401k if I no longer work for the company?

Post by rob » Wed May 25, 2016 10:47 am

ERISA Stone wrote:
rob wrote:A few issues in here....

- You can rollover to an IRA within a brokerage account and still own shares in any listed company.
For this statement to be true, the plan must allow in-kind distributions. Most plans that I have encountered are written to only allow cash distributions, so the account would have to be liquidated prior to the rollover.
Yeah - Sorry I worded that badly... I was trying to say that you can have a brokerage IRA that allows you to hold stock. Agree most plans would need to liquidate on exit and re-buy in the new IRA.
| Rob | Its a dangerous business going out your front door. - J.R.R.Tolkien

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David Jay
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Re: Can I still contribute to a 401k if I no longer work for the company?

Post by David Jay » Wed May 25, 2016 10:50 am

surfer949 wrote:..the value just went up due to a recent company merger.
An excellent time to diversify. Sell now!
Prediction is very difficult, especially about the future - Niels Bohr | To get the "risk premium", you really do have to take the risk - nisiprius

Spirit Rider
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Re: Can I still contribute to a 401k if I no longer work for the company?

Post by Spirit Rider » Wed May 25, 2016 12:02 pm

Make sure you understand the Net Unrealized appreciation (NUA) rules for employer stock in a qualified retirement plan. You lose the ability to treat the gains as being subject to capital gains tax rates if you roll them to a an IRA.

You generally will only be able to kept assets in a former employers 401k plan if those assets >= $5K.

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