Several of you mentioned that I should increase my wife’s 401k contributions after her recent raise. Great advice, but alas, she had no 401k. We were a 401k-less family. I say were because it looks like soon her employer is giving her one! Details are a bit fuzzy, but it looks like she gets a 100% match up to 1.5%. Not going to win any employer-of-the-year awards, but hey it’s progress. I really hope the administrator is Vanguard or Fidelity, but I as long as the fees aren’t onerous and there are some index funds I’ll be happy.
$89 million dollars of employer matches were left on the table in 2003. I hope none of y’all out there are giving up your 401k matches. It’s the quintessential free money! Money gurus agree: Everyone should be contributing to max out the employer match even if you have credit card debt. Where else can you get an instant 50-100% return on your money (depending on your specific match)?
As for us, we will definitely be contributing up to the match. Then maxing out both our Roth IRAs each year. For amounts over that, we will have to decide if we should contribute money to her 401k, or instead into my SEP-IRA or Individual 401k (should I decide to set one of those up). Basically whichever account offers the best investments will get the money. But it’s nice to have options!
By Jonathan Ping | Retirement | 5/25/06, 10:35pm