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Tip of the Day, change your 401k percentage.
Posted on 3/13/20 at 9:41 am
Posted on 3/13/20 at 9:41 am
If you have the means, and are not in a position to need your paycheck to pay bills, SHIFT you 401K to 100%.
You are allowed $19.5K for the year. Dump your entire check into your 401K now while the prices of everything are low.
I'd venture that most people could max this out in a couple of months and be done for the year.
**Ensure you are still able to contribute your minimum / month and still maximize your employer contributions throughout the year**
You are allowed $19.5K for the year. Dump your entire check into your 401K now while the prices of everything are low.
I'd venture that most people could max this out in a couple of months and be done for the year.
**Ensure you are still able to contribute your minimum / month and still maximize your employer contributions throughout the year**
This post was edited on 3/13/20 at 10:54 am
9
Posted on 3/13/20 at 9:45 am to oneg8rh8r
Short term market conditions should not impact your long term retirement planning IMO.
Posted on 3/13/20 at 9:47 am to oneg8rh8r
Say I dump in $19.5K by the end of the summer, what happens to my employer match for the remainder of the year?
Posted on 3/13/20 at 9:48 am to oneg8rh8r
Won't you miss out on company match if you max out in a few paychecks?
Posted on 3/13/20 at 9:52 am to LSUFrosty
For the most part yes. I think in some instances you can work around it but it’s more rare from what I can tell.
Posted on 3/13/20 at 9:53 am to Negatiger1986
quote:
Say I dump in $19.5K by the end of the summer, what happens to my employer match for the remainder of the year?
I thought your employer match doesn't count towards the 19.5k
Posted on 3/13/20 at 9:53 am to LSUFrosty
quote:depends on the company. Mine won't match once you reach the max. So be careful here.
Won't you miss out on company match if you max out in a few paychecks?
I increased mine a couple of weeks ago but made sure that the last four months I can contribute at least 5% to get the match.
Again, be very careful here with strategy. Contact your HR to confirm.
Posted on 3/13/20 at 9:55 am to castorinho
quote:
Contact your HR to confirm.
It's called true-up. Give it a google to better understand it and talk to your plan administrator.
And someone else asked. Match does NOT count towards contributions.
Posted on 3/13/20 at 10:10 am to TheWiz
quote:That's not what we're discussing. We're discussing contributing to your 19k early, and not get the match from your company, because you're no longer making contributions.
And someone else asked. Match does NOT count towards contributions.
We're not discussing the match counting towards individual max.
This post was edited on 3/13/20 at 10:11 am
Posted on 3/13/20 at 10:18 am to oneg8rh8r
You're at the beggining of one of the craziest Demand/Supply shocks in history. The buy the dip crowd should not touch their current contributions. You are telling people to forgo one of the only monetary benefits companies offer because this is the bottom. When in reality they could be buying lower than a one time $19.5K contribution.
Posted on 3/13/20 at 10:22 am to Huey Lewis
quote:
Short term market conditions should not impact your long term retirement planning IMO.
Sure this is generally true, but the OP is suggesting simply taking advantage of dips, when/if you have the ability to do so. The market has wiped out 2 years of gains, and it's the first bear market we've seen in a while. We may not be at the bottom yet, but I hope we are close to it. Seems logical to contribute as much as you can right now
Posted on 3/13/20 at 10:31 am to oneg8rh8r
What if the market is lower in 3 months?
Posted on 3/13/20 at 10:36 am to Roberteaux
Sure, but it’s just a guess. Why not contribute up to the max, collect the full match and DCA through the rest of the year?
To try to a call bottom in a current, or developing, bear market isn’t worth losing that portion of the match, IMO.
To try to a call bottom in a current, or developing, bear market isn’t worth losing that portion of the match, IMO.
Posted on 3/13/20 at 10:39 am to jlovel7
It doesn't. I was trying to make the same point Frosty made, that you potentially lose out on match if you max out before year end.
Posted on 3/13/20 at 10:47 am to Negatiger1986
You have to do the math and ensure you can contribute the minimum throughout the rest of the year and still get matching contributions.
If you are concerned that this is not a short term sell off and will persist for a long time (>4 months) then simply up your percentage to still take into account dollar cost averaging.
If you are concerned that this is not a short term sell off and will persist for a long time (>4 months) then simply up your percentage to still take into account dollar cost averaging.
This post was edited on 3/13/20 at 10:52 am
Posted on 3/13/20 at 4:09 pm to oneg8rh8r
I upped my 401k at the beginning of February because I paid off a debt. Just good luck on that front. But I like buying more shares with my money.
Posted on 3/13/20 at 4:09 pm to LSUFrosty
quote:
Won't you miss out on company match if you max out in a few paychecks?
It's up to the individual company. Mine continues to match the entire year even though my 401k is maxed out with a few months to go. Some companies don't match after the individual maxes out. Just do the research with your HR department to know for sure.
Posted on 3/13/20 at 4:59 pm to oneg8rh8r
quote:
You are allowed $19.5K for the year.
I'm allowed a lot more than that. $62000 this year.
This post was edited on 3/13/20 at 5:00 pm
Posted on 3/13/20 at 6:28 pm to VABuckeye
Why would my match disappear if I put it all in at once?
Posted on 3/13/20 at 6:48 pm to lynxcat
quote:As been mentioned, this is company specific. The company I work for, you need to contribute on each payroll cycle to get the match. People learned the hard way.
Why would my match disappear if I put it all in at once?
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