Can You Have More Than One 401k?

Wondering if you can have more than one 401(k)? The answer is yes, but with some qualifications. You can contribute to multiple 401(k) plans if you work for different employers. You may also do so if your employer offers both traditional and Roth options. However, the IRS sets combined contribution limits across all your 401(k) accounts each year. Having multiple plans might give you more investment options and potentially higher employer matches, though it can also make retirement planning more complex.

Whether you’re in the early phases of your career or on the verge of retiring, a financial advisor can help you plan and save for the future. Connect with you advisor matches today.

What Is a 401(k) and How Does it Work?

A 401(k) is an employer-sponsored retirement plan that allows employees to save and invest a portion of their paycheck before taxes are withheld. These accounts are named after the section of the tax code that established them and have become one of the most popular retirement savings vehicles in America.

The primary benefit of a 401(k) is tax-deferred growth. Your contributions reduce your taxable income for the year, and your investments grow tax-free until withdrawal during retirement. Many employers also offer matching contributions, essentially providing free money toward your retirement.

Many 401(k) plans give you a range of investment choices, such as mutual funds, target-date funds, and occasionally shares of your employer’s stock. This flexibility makes it easier to create a well-rounded retirement portfolio tailored to your goals.

How Do You End Up With Multiple 401(k)s?

Career mobility often results in people accumulating multiple 401(k) accounts over time. Each time you leave an employer where you participated in their retirement plan, you have options: roll it over, cash it out or simply leave it behind. Many workers leave their accounts with former employers, often taking the path of least resistance, inadvertently building a collection of retirement accounts.

However, many workers inadvertently accumulate multiple 401(k)s by simply forgetting about old accounts during career transitions. When leaving a job, the hectic nature of the change often means retirement accounts get overlooked. Years later, you might find several accounts scattered across plan administrators, each with different investment options and fee structures.

Sometimes multiple 401(k)s result from participating in different plan types. Self-employed individuals might maintain a Solo 401(k) for their business while also participating in a traditional 401(k) through another employer, creating another scenario where multiple accounts exist legitimately.

401(k) Contribution Limits

The main limitation on having more than one 401(k) is the cap on contributions. The IRS limits the amount that can be contributed to certain tax-deferred plans including 401(k)s. And these limits apply to 401(k) plans in the aggregate. In other words, you can’t defer the maximum contribution in one plan and repeat it in another. For 2025, the annual employee contribution limit for 401(k) accounts is $23,500. Employees over 50 can contribute an additional catch-up contribution of $7,500 for a total of $31,000. These limits apply to all the 401(k) plans an employee owns.

For example, if an employee under age 50 contributes $23,500 to a 401(k) plan with a current employer, the employee cannot defer any salary to a 401(k) set up for a self-employed side business. However, it’s possible to mix and match. That is, if the employee contributes $15,000 to the employer 401(k), the employee can contribute $8,500 to the self-employment 401(k).

Super Catch-Up Contributions

The IRS also permits 401(k) participants between ages 60 and 63 to surpass the standard catch-up contribution limit. In 2025, participants can contribute an extra $11,250 to their 401(k) if they are 60, 61, 62 or 63. These enhanced contributions are known as “super catch-up contributions.”

Employer Contribution Limits

In addition to limits on employee contributions, there are limits to how much employers can contribute to their employees’ accounts. For 2025, the combined contributions to any 401(k) by an employer and an employee under age 50 cannot total more than $70,000, or $77,500 for an employee over 50.

However, employer contributions are not considered in aggregate as employee contributions are. That is, a taxpayer under age 50 with separate 401(k) accounts for a regular job and side business who directs the maximum $23,500 in aggregate contributions to either 401(k) can still receive $46,500 in employer contributions to each 401(k).

These limits on aggregate contributions apply not only to 401(k) accounts. They also include some other types of accounts, including 403(b), SIMPLE IRA, SIMPLE 401(k) and SARSEP plans.

Drawbacks of Having of Multiple 401(k)s

Having more than one 401(k) account increases the paperwork of saving for retirement, as savers have to keep track of the account statements and other documentation. It can be simpler and easier to develop an investment strategy where all 401(k) accounts are combined into one.

Imagine having three 401(k)s from previous employers and discovering that you are overexposed to high-risk technology stocks because you couldn’t easily see your overall asset allocation.

Having several accounts means paying multiple sets of administrative fees. Over time, these small percentages can cost you thousands in lost savings growth. For example, paying an extra 0.5% in fees on a $100,000 account could cost you thousands in potential growth over 20 years.

Multiple accounts can lead to forgotten employer matches or overlooked investment options. Additionally, tracking required minimum distributions (RMDs) becomes more complicated as you approach retirement age, potentially resulting in IRS penalties if managed incorrectly.

Bottom Line

It is legally permissible to have more than one 401(k) account and employees who switch jobs frequently or are self-employed on the side may find themselves in this situation. While most job-switchers roll over 401(k)s into a new employer’s plan, it can be desirable to keep the old one if it has lower fees or more investment options. Having multiple 401(k) plans doesn’t change the cap on total annual tax-deferred contributions to the plans, however, and it can increase the burden of paperwork and fees.

Tips on Retirement Planning

A financial advisor can help you account for tax rules and other considerations when creating a financial plan. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
Use the SmartAsset 401(k) calculator to get a quick estimate of what your 401(k) will be worth over time.