401 K: how much are you allowed to invest?

[BMBiology]

How much money does your company allow you to invest in your 401 K? How much will the company match?

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[Old Timer]

The law limits the total amount you can put into your 401 K plan. Each company has their own formula as to how much they will match.

Some detail here.

 

[BMBiology]

So Old timeer, how much is CVS letting you put in your 401K?

 

[Old Timer]

So Old timeer, how much is CVS letting you put in your 401K?

CVS matches dollar for dollar up to 5% of your income....

 

[WVUPharm2007]

5%

 

[Old Timer]

5%

If that is meant as a question, the answer is yes. If you make 100,000.00 per year and put the 5% of your salary in your 401K, they will match you dollar for dollar so you socked $10,000.00 into your 401K.

 

[WVUPharm2007]

If that is meant as a question, the answer is yes. If you make 100,000.00 per year and put the 5% of your salary in your 401K, they will match you dollar for dollar so you socked $10,000.00 into your 401K.

Um...no...that's what my hospital gives with their 403b plan...

 

[Vitamin K]

If that is meant as a question, the answer is yes. If you make 100,000.00 per year and put the 5% of your salary in your 401K, they will match you dollar for dollar so you socked $10,000.00 into your 401K.

Is that 5% of your pre-tax salary or after taxes? That's a big difference in a state with income tax

 

[WVUPharm2007]

Is that 5% of your pre-tax salary or after taxes? That's a big difference in a state with income tax

Pretax for me.

 

[Old Timer]

401K and 403 B by definition are on Gross income. Also, your contribution is free of Federal tax...

 

[TwoMoons]

Anybody know much Walgreens matches on their 401k?

 

[ItsOverZyvox]

I only get 4%!!!!

But it's aight...I get 35 days of PTO + 6 holidays per year..

 

[67echo]

I get zero percent...but I get 30 days of PTO and 13 holidays per year

 

[confettiflyer]

I get zero percent...but I get 30 days of PTO and 13 holidays per year

Cuz you get 50% of the average of your last 3 years of salary as pension for life once you hit 20 years.

One would need to save about $1M to withdraw ~$40k at retirement and have it safely last through the rest of their life. Or something like that, I can't remember the figures.

 

[BMBiology]

I have decided not to max out my 401 k contribution but only to what the company will match because:

(1) I can't take money out until when I am old without being penalized
(2) I may be dead by then
(3) The stock market can tank again when I am about to retire.
(4) Having money when you are 70 is not as fun as having money when you are 35.

I don't like the fact that I won't have much control over my money when it is in 401 k. I will probably do anything else with my money. Am I missing anything here? What is your opinion?

 

[ItsOverZyvox]

I have decided not to max out my 401 k contribution but only to what the company will match because:

(1) I can't take money out until when I am old without being penalized
(2) I may be dead by then
(3) The stock market can tank again when I am about to retire.
(4) Having money when you are 70 is not as fun as having money when you are 35.

I don't like the fact that I won't have much control over my money when it is in 401 k. I will probably do anything else with my money. Am I missing anything here? What is your opinion?

Not a bad idea actually. 401K is tax deferred, not tax free. If you really want to have fun, you need a source of residual income. You can take the money out of your salary and put it into a vehicle that will provide you with it. Finding that vehicle is the key.

With the uncertainties in the stock market future and having witnessed the Boomers getting screwed, I will probably change my outlook on how I invest.

 

[acetyl]

Anybody know much Walgreens matches on their 401k?

Wags matches 2:1 up to 2%, then there is a "variable amt that they add based on company performance. 2008 it was $2.92 per $1 of your money, up to 2% (pre-tax contribution).

The max you can contribute as a high salary employee is $15,500/year to your 401K at Wags.

 

[confettiflyer]

Wags matches 2:1 up to 2%, then there is a "variable amt that they add based on company performance. 2008 it was $2.92 per $1 of your money, up to 2% (pre-tax contribution).

The max you can contribute as a high salary employee is $15,500/year to your 401K at Wags.

Didn't Wags have a ridiculously long period of time before its match vests?

 

[TwoMoons]

Wags matches 2:1 up to 2%, then there is a "variable amt that they add based on company performance. 2008 it was $2.92 per $1 of your money, up to 2% (pre-tax contribution).

The max you can contribute as a high salary employee is $15,500/year to your 401K at Wags.

Thanks for the response. So, baically, WAGS only matches up to 2% of your salary (whatever that match is) and then that is it? Is doesn't match 1 to 1 or anything like that from 2% to 5%?

 

[Sosumi]

I have decided not to max out my 401 k contribution but only to what the company will match because:

(1) I can't take money out until when I am old without being penalized
(2) I may be dead by then
(3) The stock market can tank again when I am about to retire.
(4) Having money when you are 70 is not as fun as having money when you are 35.

I don't like the fact that I won't have much control over my money when it is in 401 k. I will probably do anything else with my money. Am I missing anything here? What is your opinion?

Sounds a lot like what I'm doing. Rite-aid only matches 100% up to 3% of your income and 50% from 3 to 5%. So I only contribute 5% -- it is "free money" afterall. I'd rather have the rest of the money to play with -- whether it'd be investing in other ventures like real estate or just having fun with it once in a while.

 

[acetyl]

Didn't Wags have a ridiculously long period of time before its match vests?

Yeah, I believe the way it is now is that you have to be an employee for at least one year to get the additional (whatever is > than the 2:1) monies that they give, and have to be vested for something like 5 years before the money actually becomes yours. As I recall, each year "you get" a greater percentage of the money from that match, if you were to withdrawal it. I'm not 100% on that though.

 

[acetyl]

Thanks for the response. So, baically, WAGS only matches up to 2% of your salary (whatever that match is) and then that is it? Is doesn't match 1 to 1 or anything like that from 2% to 5%?

Yep, so you contribute 2%, they basically contribute 6%. (~3:1)

If you make $115,000/year (at 2%) --> $2300 from you, and $6900 from company...total which is less than the $15,500/year you can contribute. So most people tend to contribute more than just the matched 2%.

 

[BMBiology]

What company offers the best 401 k matching? It sounds very similar.

 

[Old Timer]

(2) I may be dead by then

Chances are you will NOT be dead by then.

(3) The stock market can tank again when I am about to retire.

Is there some rule that says your 401 has to be invested in stock all of the time?

(4) Having money when you are 70 is not as fun as having money when you are 35.

It's not fun to not have money and also not have the ability to earn more. If you are short now, you can pick up more hours somewhere to earn more money, not so much at 70....

I don't like the fact that I won't have much control over my money when it is in 401 k. I will probably do anything else with my money. Am I missing anything here? What is your opinion?

You have complete control of your money. I have 0% of my 401K in stock at the present time. I have it all in cash. Just about anything you can do outside of your 401K, you can do inside of your 401K. It's silly not to at least max out your matching contribution. After that, you have to speak to your tax adviser as to the best choice for you based on your age and income.