Can You Have Multiple 401ks? [A Look At Mine]

My Lowe’s 401k contributions have started, and I’m excited. I’m only contributing 6% per pay period, but now I have two 401k plans when I didn’t have any last year. So, I wanted to share my experience contributing to Lowe’s 401k plan. Remember, I’m NOT a financial advisor, and I’m only sharing what I’m personally experiencing and what I’m doing to catch up with retirement. 

I am investing in the Lowe’s 401k and a Solo 401k. According to the IRS, you can have multiple retirement accounts, as long as you abide by the contribution limits. Failure to do so will result in expensive penalties.

Keep reading and I’ll share more about my two retirement accounts and how much I’m investing in my Lowes and my Solo 401k.

*This page contains affiliate links to products I recommend. If you purchase something from this page, I may receive a small percentage of the sale at no extra cost to you.

Does Lowe’s Offer Part-Time Employees A 401k?

After more than 13 years of being self-employed, I decided to go back to the workforce. I chose Lowe’s Hardware because of its benefits to part-time employees. Plus, I have an older friend who has been working there, and she was happy. 

So I decided to apply, and low and behold, they hired me. But unfortunately, once I got hired, I had to wait 30 days before I could begin contributing to my 401k. 

That day has come, and I’ve made my first contribution. I’m fully vested, meaning Lowe’s matches 4.25% of my 6% contribution. 

This doesn’t sound like a lot, but I never turn down free money, and neither should you. With me being 50 years old, I can use all the help catching up with my retirement that I can get. 

Signing Up And Contribution Process

Signing up for Lowe’s 401k plan was a little confusing (at least for me). They offer several investment options I had never heard of, and I had no clue which to choose. 

I’m pretty clueless when it comes to choosing investment plans. I’ve read several financial books in the last year and for my 401k and Roth IRA, I follow the information from “The Simple Path to Wealth” by J.L Collins

If you haven’t read it, I highly recommend it. It’s written for people who don’t want to hire financial advisors but don’t want to spend tons of time in their investment accounts. 

As you know, I love investing in dividend stocks, but when it comes to my tax-advantaged accounts, I want it to be as simple as possible. 

So, when I signed up for the Lowe’s 401k employee, I opted for the Vanguard Target Retirement 2035 Trust. 

Investment Options

I’ve had several jobs before but never really looked at the investment options offered. However, this time (maybe because I’m older or because I’ve read several financial books), I knew what I was looking for. 

I was looking for an investment option with the following:

  • Minimal fees
  • Vanguard Investments

I’m sure there are several other things I could’ve considered when choosing an investment option. But as mentioned above, I’m not a financial advisor, and when I saw that they offered Vanguard investments, I jumped on it. 

My Roth 401k is invested in VTSAX, which is the Vanguard Total Stock Market Index Fund Admiral Shares. This is the one that J L Collins talks about in The Simple Path to Wealth. 

Unfortunately, VTSAS wasn’t an option for Lowe’s investment options, so I chose one of the Vanguard options. 

Unfortunately, I didn’t write down all the investment options Lowe’s offers, but there’s a lot. So when the time comes, make sure you do your due diligence. 

Can You Invest In Two 401k Plans?

Yes, you can, and that’s what I’m doing. However, regardless of how many 401k plans you invest in, you can only contribute the maximum the IRS allows. 

This means that for 2023, I get to invest a maximum of $30,000 as an employee because I’m 50 years old. So, between my Lowe’s 401k and my Solo 401k, my employee contributions can’t exceed 30k for 2023. 

However, since I have a Solo 401k, I also get to make profit-sharing contributions of up to 25% of my self-employment income. So the amount I will contribute for 2023 depends on how much of my self-employment income I can keep. However, the max contribution limit for 2023 is $66,000. 

My goal is to contribute a total of $45,000 to both of my 401k’s this year. That will be challenging, considering I’ve lost one of my income streams on my online business. 

But I’m doing everything I can o save my business income. 

As soon as I get paid, I push as much as I can to my Axos Business Savings account, so I don’t save it. I’ve also stopped paying myself anything from my LLC and am living on my Lowe’s paychecks, which is challenging, considering I don’t make a lot. 

But if I can sacrifice a little right now in my 50s, I won’t have to worry about having to work when I’m 65. Most people don’t feel the same way I do. Several of my friends think I’m crazy. 

They constantly ask me why I chose to go back to work as an employee when I’m making decent money from my blogging business. 

Managing Multiple Investment 401k Plans

If you have two or more 401k’s, make sure you don’t contribute more than the limits. According to Nerd Wallet, you’ll have to pay twice the taxes on the overcontribution limit unless you catch the error and fix them before filing taxes in April.  

This sounds confusing to the average person, and it is. But unfortunately, most things related to taxes are confusing, which is why I hired a CPA to do my taxes last year. 

If you have more than one 401k, ensure you know the contribution limits and don’t exceed them. I don’t have to worry about going over the limits, I don’t make that much with Lowe’s, and I’ll be lucky if I contribute more than 5k as an employee. 

However, that doesn’t matter. Whatever I do contribute to my Lowe’s plan means that I can deduct that from having to the contributions from my solo 401k. 

Contribution Limits

Let me explain what I mean. I get paid biweekly from Lowes, so I can expect about 18 more paychecks for the year (I’ve never been good with math, so you may want to check it). Well, 17 for me, since I’m taking two weeks unpaid vacation next month. 

My first contribution amount was $68.56, and I don’t know if that was my contribution or if it includes the Lowe’s match. But most financial blogs say employers match employees’ contributions each payday.  

So if I continue making that same contribution for the next 17 paychecks, that means I’ll have contributed $1,165.52 as an employee. That doesn’t sound like a lot, but I’ll still be able to contribute $28,834.48 to max my employee contribution. 

Now I wish I would’ve gotten a job that offers a 403B or pays me more money. However, I didn’t want to work eight hours. 

Unfortunately, that’s still a lot that I have to save in my business account to max it out, and hopefully, I’ll be able to do it. 

If you only have one 401k, you don’t have to worry about overcontributing, especially since most brokerage accounts keep track of it for you. At least, I know Vanguard does for my Roth. 

I have my Solo 401k with Fidelity, and I use a spreadsheet to help me keep track of my contributions. Plus, I only make contributions once a year after filing my taxes. 

Advantages and Disadvantages

The biggest advantage to having more than one 401k is that you’re more likely to maximize your employee contribution. Of course, that depends if you’re working as an employee and getting paid an hourly wage. 

If you’re contributing to multiple Solo 401ks or SEP IRAs, that means you’re getting your money from side hustles. I’m a fan of side hustles, aka gigs. That’s why I have my blogging business and my YouTube channel. 

However, you can work your ass off on your side gig and not make anything or six figures or more. There’s no guarantee that you’ll make money. 

I know there’s no security working as an employee, but if you have a job while building your side gig, at least you have a stable income until you grow your business. 

Then once you’re making a full-time income with your side gig, you can decide whether to continue as an employee. 

The biggest disadvantage is working all the time, whether it’s for someone else or yourself.

I’m not of fan of being an employee, but unfortunately, I have to use every means possible to catch up with my retirement because I didn’t save when I was younger. 

So I’m keeping my Lowe’s job until I reach 100k in my Solo 401k. Unfortunately, I’ve only contributed $28,500, so I have a way to go. 

Seeking Professional Help

Everyone is different, and some people will say yes, you should hire a financial advisor because they know what they’re doing. 

However, no one will care as much about your money as you do. Plus, if you follow The Simple Path To Wealth, you don’t have to hire anyone. 

I’m NOT a fan of paying someone to handle my money. It could be because I don’t have a lot in my investment accounts, but I refuse to pay someone who promises they can make me more money. 

Back in the day, when it was harder to open an investment account, I would have paid someone. But today, with all the Internet, investing apps, and fractional shares, it’s so easy to open up an account and get started. 

You don’t have to pay anyone as long as you read some financial books or listen to podcasts that teach the average investor how to get started. 

Of course, if you’re scared to start, you may want to hire someone. The important thing is to start investing in your retirement. 

Final Word

Yes, you can have multiple 4o1ks, regardless of whether you have a SEP, SOLO, or any other type of retirement plan. The most important thing to remember is that you must have good record-keeping so you don’t exceed your contribution limits. 

Having multiple 401ks means it will be easier to maximize your yearly contributions, especially if you have a stable income. 

It’s NEVER too late to catch up with your retirement. So, join me on my journey as I share my experience of using my part-time job at Lowes and side gigs to catch up with my retirement. 

I’m not a financial advisor, but I’ve realized I must get serious about it, especially if I don’t want to live in poverty in my golden years. I wish someone had taught me about money when I was younger. 

But since I can’t bring rewind the past, I’m doing everything I can to create the future I want!

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