401K - Advice from the Experts Please

[masraum]

Originally Posted by djmcmath

My employer has a great plan, BTW: they match 5% of my salary, whether I contribute or not, and there's no vesting. So if I contribute $0.00, they still put in money every month, and it's my money from day 1. Great benefit, but horribly uncommon.

Dan

Wow, I've had some good plans, but nothing that touches that!!!

[VincentVega]

Matching is nice, but dont let a poor deal keep you from saving for your future.

Problems with an IRA are low contribution limits and income restrictions based on income. 401k has higher limits, if you can/want to sock away more.

Lots of good advice here, post any question you have and I'm sure this group will have some ideas.

[Z-man]

Originally Posted by djmcmath

My employer has a great plan, BTW: they match 5% of my salary, whether I contribute or not, and there's no vesting. So if I contribute $0.00, they still put in money every month, and it's my money from day 1. Great benefit, but horribly uncommon.

Dan

Interesting... I read about your company recently, or another company that does that same thing with 401k's -- I believe your company is on "Fortune's 100 Best Companies to Work For" - 2010 list. Perhaps its SAS, Google, NetApp, or Whole Foods?

Oh - and to clarify my company -- it is 75% match. I can contribute up to 11% of my salary to my 401k, but the company will only do the 75% match on the first 10% I contribute.

Bottom line for me is this: my 401k contribution comes out of my paycheck before I see it - thus, I don't consider it as 'money spent.' I have always contributted the max. percent of my salary a company would permit, regardless of how much their contribution percentage was.

One thing I would change is that I have always chosen rather conservative funds, and could have invested higher risk funds earlier on. However, when the market took a dive a couple of years ago, I lost less than those who invested in aggressive (high risk) funds, and my portfolio rebounded quicker.

-Z-man.

[KFC911]

Lots of good advice in this thread...start early, save as much as possible, and time will be your greatest asset imo. I've had "good, better, and FANTASTIC" 401k plans, and that allowed for for "not looking back" when my position was outsourced a few years ago. If your "plan" doesn't have a decent selection of funds, see if you can open a "brokerage account" under the plan and increase your options immensely. At the "end", I was contributing the federal limit, the co was "matching" the first three percent, and all employees' plans were funded by the co. based upon age. etc. (regardles of their participation) as the pension plan was reduced...in my case, an additional 9%...that is a gold plated Cadillac of plans imo .

ps: I've also "rolled" some of my 401ks over to IRAs upon termination in the past, and Roths never "made a bit of cents/sense" in my particular situation...it truly varies depending upon your circumstance, and due dilligence is required.

pps: I've never "merged" plans (for IRS 72T distrubution purposes), but do have all of them under the same roof (Fidelity) now.

[asphaltgambler]

Thanks all - will research all advice given

[vracer]

It is very simple, and it is spelled R O T H. You're in a fairly low tax bracket now. Pay the tax now, not when you take the money out. I saved about 20% when I contributed to my IRA. Now I'm paying almost 50% when I take the money out, and their are a lot more dollars.

[KFC911]

Originally Posted by vracer

It is very simple, and it is spelled R O T H.... .

Respectfully, there is no "simple" answer imo. EVERYONE should carefully analyze "their" particular situation and act according to what is best for them. There are no "one size fits all" answers...do your homework!!!

[asphaltgambler]

thanks again all