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Brown Cafe UPS Forum
UPS Retirement Topics
Exceeding Maximum 401k in 2020
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<blockquote data-quote="Gabba" data-source="post: 4378490" data-attributes="member: 58591"><p>the only way you could go over the limit is if you had two jobs with 2 different 401k plan providers. within our plan, they'll cut you off at 19500. however if you're planning to max your contributions don't skip the After-Tax 401k part. that is not subject to the 19500 cap. it's subject to the 53000 cap which is completely out of reach so it may as well be infinite. </p><p></p><p>After-Tax 401k works like this: when you leave or retire you roll over the cumulative total of your contributions to a Roth IRA, and any above that rolls over to a regular IRA. your contributions follow roth rules in that you can take them out at anytime, but your earnings are subject to tax and penalties for early withdrawal. when you do leave UPS roll over as soon as possible because any earnings from your contributions then go into the roth column, unlike before you roll over, staying in the plan they go into the traditional column.</p></blockquote><p></p>
[QUOTE="Gabba, post: 4378490, member: 58591"] the only way you could go over the limit is if you had two jobs with 2 different 401k plan providers. within our plan, they'll cut you off at 19500. however if you're planning to max your contributions don't skip the After-Tax 401k part. that is not subject to the 19500 cap. it's subject to the 53000 cap which is completely out of reach so it may as well be infinite. After-Tax 401k works like this: when you leave or retire you roll over the cumulative total of your contributions to a Roth IRA, and any above that rolls over to a regular IRA. your contributions follow roth rules in that you can take them out at anytime, but your earnings are subject to tax and penalties for early withdrawal. when you do leave UPS roll over as soon as possible because any earnings from your contributions then go into the roth column, unlike before you roll over, staying in the plan they go into the traditional column. [/QUOTE]
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