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TOPIC: Multiple 401k Plans

Multiple 401k Plans 2 months 1 week ago #1

  • fireme
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There are numerous financial institutions that offer 401k plans both through an employer and for people wanting to open one up on their own. Have you ever heard of people who have 2 or 3 401k's operating at the same time for the purpose of seeing which types of investments perform better?

I'm thinking about doing this.
Last Edit: 2 months 1 week ago by fireme.

Multiple 401k Plans 2 months 1 week ago #2

  • CammieZ
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No, I don't have more than one 401k plan. I do have several IRA's but only one plan through work. I do have stocks in the market too. I'm all about investing for my retirement.

Multiple 401k Plans 2 months 1 week ago #3

  • Serene
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I don't know anyone that has ever done this. It sounds like there could be some great potential there. What happens when you find out that one is outperforming the other? Will you eventually roll everything over into that one account or do you plan on keeping them separate forever?

Multiple 401k Plans 2 months 6 days ago #4

  • Pat44S
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I'm an accountant and I don't do this. You can have several different options under one 401k plan. I too have different retirement savings but only one 401k plan.

Multiple 401k Plans 2 months 2 days ago #5

  • Perplexed
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I, too, have never heard of opening two or three 401k plans. If you could afford to do this I suppose that it may be a viable way to grow a nest egg. I would be concerned about another financial "bubble", however, as in 2008. It seems as though you could really lose your shirt if things go south.

Multiple 401k Plans 1 month 4 weeks ago #6

  • Kira
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If that's a good way for you to save then do it. I had one 401K and some other investments as well. Check your interest rates before you do anything. Banks' interest rates are not very good these days.

Multiple 401k Plans 1 month 2 weeks ago #7

  • Dunlop
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Some swear by 401k plans while others don't. In times of financial trouble, and depending on how you spread your investments, you can lose your shirt. I've known people who have been disillusioned by 401k's. It's a judgement call. As to opening three of them, I'm really not sure why you would want to do that. If you're young, try one 401k and experiment with other investment vehicles for a few years, then, and only then, if you truly feel that you can do better with another 401k or two, then go for it.

Multiple 401k Plans 4 weeks 1 day ago #8

  • fireme
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Serene wrote:
What happens when you find out that one is outperforming the other? Will you eventually roll everything over into that one account or do you plan on keeping them separate forever?

I would keep them separate, but there's always the option of shuffling around what you invest in within one plan. If one outperforms another, i would find out why and reconfigure my investments within the plan that isn't doing so hot so it mirrors the one that is.

For example, if I invest in the precious metals sector in one plan and not the other and that sector is doing well with the speculation that it will continue to do well, I'll go my other plan and either invest in that, or, ideally, in a sector that is directly effected by the precious metal sector. It's hard to diversify like that with only one plan.