Switching to SDBA from traditional 401k

Assalamu alaikum,

My company offers a 401k through Fidelitys BrokerageLink SDBA option. I am however required to accrue $2500 in vested funds in an existing 401k with the company. Once I’m able to hit that target and switch to the SDBA, will I need to purify those savings?

You would only need to purify any gains accrued during the time you were invested in any non-compliant funds. For example, if you invested $2000 and it grew to $2500, you’d need to purify the $500 gain. Let’s assume 10% of the holdings in the 401k are non-compliant—you would purify by donating 10% of the $500, which is $50. The original principal amount doesn’t require purification.