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Started By
Message
Stupid 401k company match question
Posted on 4/28/25 at 8:24 am
Posted on 4/28/25 at 8:24 am
I have heard my company matches 7% and also people have said 6%. I decided to see for myself, and this is how they describe it.
I'm a self-proclaimed dummy in math but can someone translate what this means? The website says they match up to 6%, but to me it doesn't make sense when they say "133% of first 3 and 100% of the next 3". Doesn't that put it over 6%?
When you contribute to your plan, your employer matches 133.33% of the first 3% of your pay, and 100% of the next 3%.
I'm a self-proclaimed dummy in math but can someone translate what this means? The website says they match up to 6%, but to me it doesn't make sense when they say "133% of first 3 and 100% of the next 3". Doesn't that put it over 6%?
When you contribute to your plan, your employer matches 133.33% of the first 3% of your pay, and 100% of the next 3%.
8
Posted on 4/28/25 at 8:28 am to dallastiger55
The way I interpret it is if you contribute 6%, they contribute 7%.
Posted on 4/28/25 at 8:29 am to dallastiger55
Sounds like if you put in 6% they will put in 7%.
You do not have to put in the full 7% to get the full match.
IE
If you put in 3% = They put in 4%
If you put in 4% = They put in 5%
..
If you put in 6% = They put in 7%
If you put in 7% = They put in 7%
You do not have to put in the full 7% to get the full match.
IE
If you put in 3% = They put in 4%
If you put in 4% = They put in 5%
..
If you put in 6% = They put in 7%
If you put in 7% = They put in 7%
Posted on 4/28/25 at 8:31 am to dallastiger55
It looks to me if you put 6% of your salary they will match it plus an additional1% for a total of 7% company "match". Total would be 6% from you and 7% from the employer.
Posted on 4/28/25 at 8:49 am to dallastiger55
That's a very nice match if true.
Posted on 4/28/25 at 8:52 am to VABuckeye
I guess that makes sense. Thank you for the explanation.
Yes, that is copy and pasted from my company website
Yes, that is copy and pasted from my company website
Posted on 4/28/25 at 9:17 am to VABuckeye
quote:
That's a very nice match if true.
Very much so. I get the standard 50% up to 6% of your salary. I contribute 6% and company puts in 3%.
And I think they just reduced it by a percentage point somewhere.
Posted on 4/28/25 at 9:24 am to dallastiger55
7% of 6% is certainly an awesmoe match. We do safe harbor 100% up to 3% and then 50% up to 5% (so 4% match on 5% effectively).
Posted on 4/28/25 at 9:28 am to VABuckeye
quote:-(-1)
That's a very nice match if true.
Posted on 4/28/25 at 9:59 am to WhiskeyThrottle
They are about to change ours at work. Currently I get 10% whether I contribute anything or not. A lot of the lower income workers don't contribute anything extra, so they are going to try something like 8% company contribution and they will match an additional 3%, so if you put some in yourself the company will actually contribute more but if you don't do anything it costs the company less. It'll probably save the company money even though its a no brainer to take the match.
Posted on 4/28/25 at 10:09 am to dallastiger55
This is one of the better matches I have heard of. You should always take the match at a minimum.
Posted on 4/28/25 at 10:09 am to WhiskeyThrottle
quote:
Very much so. I get the standard 50% up to 6% of your salary. I contribute 6% and company puts in 3%.
This is how ours works as well but I do contribute the max allowable. The nice thing about my employer is that my match goes in every pay period.
Posted on 4/28/25 at 11:21 am to VABuckeye
quote:
That's a very nice match if true.
This got me curious, I know my company match is very good, 8% (Technically it’s 50% of the first 8% matched, plus an additional 4% profit sharing)
I’m very grateful for it and obviously take full advantage, but it got me wondering, is this abnormally high?
Posted on 4/28/25 at 4:09 pm to VABuckeye
Now MLB has the best one ever, the player doesn't even have to make a 401K contribution.
quote:
is not required to make a contribution to receive this benefit. Instead, they receive this benefit based on that year's service time.
For a player to be eligible for a team contribution they must achieve a quarter of the year of MLB service time in that season. That equates to 43 days on the active roster.
Here is an example of what this looked like in 2023 for players who had a full year of service time.
$22,500 max pre-tax contribution* not required
$40,000 MLB contribution
$3,500 max post-tax contribution* not required
Posted on 4/28/25 at 4:30 pm to dallastiger55
quote:
The website says they match up to 6%, but to me it doesn't make sense when they say "133% of first 3 and 100% of the next 3". Doesn't that put it over 6%?
The simple breakdown is - 3 buys you 7. 6 buys you 13. They're matching 6 of yours with 7 of theirs, total, if you go all in. You get 4 matched to your first 3 and then 3 matched for your next three.
Your part that gets maxed is 6%. They kick in an extra 1 point on the first 3, which is where the 7th "match" point is.
Hope this helps.
This post was edited on 4/28/25 at 4:33 pm
Posted on 4/28/25 at 6:36 pm to dallastiger55
quote:
When you contribute to your plan, your employer matches 133.33% of the first 3% of your pay, and 100% of the next 3%.
133% X 3% = 4%
100% X 3% = 3%
Total match on your 6% = 7%.
Total added to your account that period = 6% + 7% = 13%.
Posted on 4/28/25 at 6:43 pm to dallastiger55
quote:contribute the max if you can!
401k
Posted on 4/28/25 at 7:51 pm to AlteriorMotive
quote:
This got me curious, I know my company match is very good, 8% (Technically it’s 50% of the first 8% matched, plus an additional 4% profit sharing) I’m very grateful for it and obviously take full advantage, but it got me wondering, is this abnormally high?
My shite is complicated as hell so I don’t even know what the match is. There is some formula they take into consideration for tenure on esop portion.
I put in 12k to 14k and they put in around 20k to 23k the last few years.
This post was edited on 4/28/25 at 8:09 pm
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