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Greetings, Richard, and welcome. You asked:

So if I started a 401(k) now, what happens if I only have 6months of contributions? Is it possible to transfer 401(k) funds to a new fund at relatively low cost - eg. a bit like with IRAs?
Or do they just collect, so that when I retire I might have a dozen different 401(k)s?


If you begin a 401k now, and then leave that job in six months or so, you may arrange to have that money transferred to an IRA of your choice. If there's more than $5K in that account, you can even leave it in the old 401k if you desire. If you have less than $5K, most plans will force you to get the money out of the plan. It's possible you may even be able to transfer the money to a new employer's 401k plan, either from the IRA you set up to receive those funds or from the old 401k plan itself. The new 401k plan, though, does NOT have to accept transfers of old 401k plan money, and many plans don't.

Bottom line: You can always transfer that money to a traditional IRA. You may be able to transfer it to a new employer's 401k plan as well.

Regards..Pixy
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