Changed jobs and can't contrbute for 1 year

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Author	Comment
gotbbq	Changed jobs and can't contrbute for 1 year	Lead	[-]
Posts: 1 (03/23/08 05:54:09) Reply Quote More My Recent Posts Message Me Connection Blocking Invite Ignore User's Posts	I've changed jobs and am not allowed to contribute into the new employers 401k for one year. I've contributed $500 to date in the previous empoyers 401k. Will I be allowed to contribute $4500 into an IRA? What is the reason for the 1 year waiting period? Does it have to do with employer matching? Can I offer to contribute to the plan without the employer matching? Thanks in advance.
ms401		#1	[-]
Posts: 21 (04/21/08 05:47:12) Member Reply Quote More My Recent Posts Message Me Connection Blocking Invite Ignore User's Posts	All plans have a choice about when you can start contributing. Many employers are moving toward deferrals starting day 1 and matching 1 year later. In general the one year wait has been because of turnover issues. Gives the employer time to find out if you are a good fit with the organization. Your deduction for the IRA is going to be capped by the $500 you put into the 401k (your accountant can best answer that question as to how much it will be capped).

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