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Started By
Message
I am going dump 100% of bonus in 401k - talk me down
Posted on 1/1/25 at 10:03 am
Posted on 1/1/25 at 10:03 am
OT poor so won't be full $23,500 but most of it - timing 2nd week January
Main concern is it almost like I am market timing by doing big investment vs even weight over 52 weeks. I am not trying to time just want to be done with 401k. I have 20 years to go so assuming hoping with that timeline statistically it doesn't matter regarding timing of deposits.
Money talk rain the down votes.
Main concern is it almost like I am market timing by doing big investment vs even weight over 52 weeks. I am not trying to time just want to be done with 401k. I have 20 years to go so assuming hoping with that timeline statistically it doesn't matter regarding timing of deposits.
Money talk rain the down votes.
10
Posted on 1/1/25 at 10:08 am to thelawnwranglers
quote:
I have 20 years to go
This answers your question. Just put it in and forget it.
Posted on 1/1/25 at 10:10 am to SloaneRanger
Perfect kind of figured 20y perspective didn't matter
Posted on 1/1/25 at 10:12 am to thelawnwranglers
Do you have a company match? If so, you lose it when you hit 23.5k limit so depending on your contributions that could be early in the year and you will be losing free money.
Posted on 1/1/25 at 10:14 am to ronricks
They are cheap and match at end of year regardless so not a factor but good point
Posted on 1/1/25 at 10:28 am to thelawnwranglers
He means you can’t exceed the 23k so they would only be able to give you the difference in what you are putting and the limit. If they do any contribution you’ll just want to max out what they can give you. If they fully match do 11,500 and let them put in the rest.
Edit: I was wrong
Edit: I was wrong
quote:
The employer’s 401(k) maximum contribution limit is much more liberal. Altogether, the most that can be contributed to your 401(k) plan between both you and your employer is $70,000 in 2025, up from $69,000 in 2024.
This post was edited on 1/1/25 at 10:57 am
Posted on 1/1/25 at 10:39 am to ronricks
I don't believe that the employer contributions count towards the individual contribution limit for a 401k plan.
Posted on 1/1/25 at 10:52 am to Tigerfan14
quote:That's not how it works. The max is for the individual, not taking into account the match.
He means you can’t exceed the 23k so they would only be able to give you the difference in what you are putting and the limit. If they do any contribution you’ll just want to max out what they can give you. If they fully match do 11,500 and let them put in the rest.
Posted on 1/1/25 at 10:59 am to thelawnwranglers
Set it and forget it.
Then rinse and repeat EVERY year.
Then rinse and repeat EVERY year.
Posted on 1/1/25 at 11:58 am to OTIS2
Put the max allowable into a Roth.
Posted on 1/1/25 at 12:15 pm to thelawnwranglers
Nothing to talk down. There are much worse things you could do with that money.
Do you have any control over the portfolio? That's the only thing you should consider when thinking about timing. If you think the market's going up from here and your broker offers an S&P 500 index, go with that. If you have some risk aversion, pick a bond-heavy target date portfolio. Or do your research and pick something in between. Don't always trust that the default portfolios are gonna be the best ones for you.
Do you have any control over the portfolio? That's the only thing you should consider when thinking about timing. If you think the market's going up from here and your broker offers an S&P 500 index, go with that. If you have some risk aversion, pick a bond-heavy target date portfolio. Or do your research and pick something in between. Don't always trust that the default portfolios are gonna be the best ones for you.
Posted on 1/1/25 at 12:31 pm to messyjesse
Would not use a bond heavy portfolio. The guy has 20 years for his money to work for him.
Posted on 1/1/25 at 12:33 pm to thelawnwranglers
Good goal of investing it. Without knowing more about you, would say consider a Roth for part of it. Always, always take advantage of any company match; every year.
Posted on 1/1/25 at 12:46 pm to KWL85
quote:
Good goal of investing it. Without knowing more about you, would say consider a Roth for part of it. Always, always take advantage of any company match; every year.
Might at least do 2024 spousal Roth - I am close to limits so need all tax forms to come in
If it is a spousal Roth - I just set her up a Roth Roth and fund it
Aka to Charles Schwab it is just a Roth
This post was edited on 1/1/25 at 12:52 pm
Posted on 1/1/25 at 12:51 pm to thelawnwranglers
Sounds like a good plan. Can you hit the 23,500 mark with regular contributions in addition to your bonus?
Do you miss out on some company matching if you lump sum at once versus periodically?
Do you miss out on some company matching if you lump sum at once versus periodically?
Posted on 1/1/25 at 12:59 pm to JohnnyKilroy
quote:
Sounds like a good plan. Can you hit the 23,500 mark with regular contributions in addition to your bonus?
Yeah I will - gives me more weekly take home, will drop down to lower % - but will get to $23,500
quote:
Do you miss out on some company matching if you lump sum at once versus periodically?
They contribute at year end so will get full match.
All plans true up though if match is done every pay check I believe
Posted on 1/1/25 at 1:00 pm to thelawnwranglers
Nice. Sounds like you have a good plan
Posted on 1/1/25 at 1:11 pm to JohnnyKilroy
45 at 50-55 might just drop down to company match. (supposedly reached my coast fire number)
Retirement account rich cash poor ( got emergency fund)
So at some point need to focus on that
Retirement account rich cash poor ( got emergency fund)
So at some point need to focus on that
This post was edited on 1/1/25 at 1:17 pm
Posted on 1/1/25 at 2:37 pm to thelawnwranglers
401(k) contribution limitations are governed by your annual income. Check to see what your max is so you verify if this is even possible.
Don't know your personal situation so I'm just going off general rules.
Don't know your personal situation so I'm just going off general rules.
Posted on 1/1/25 at 2:42 pm to CHGAR
quote:
CHGAR
401(k) contribution limitations are governed by your annual income.
No it's $23,500 if you have atleast $23,500
The question is if one lump purchase in January is statistically different from 52 purchases over the year if you have a 20 year perspective
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