401K help.

[akaykay]

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Wish we had a finance/investing forum...

I have a FT gig that offers a 403b with match (1.25%) after 1 year of service, which I'll reach mid year. In the meantime I have a PT job that still offers 5% match and matches at dollar to dollar for the first 3% then 50% for the remaining 2%. Reason why I'm still getting it is because I stepped down from FT.

So to sum it up, should I even bother contributing to the FT job? The funds are great but it seems pointless given the dismal 1.25% match. I do, however, get an additional 6% automatic employer contribution without having to make contributions. Some of you may know which company I'm referring to
Thanks

 

[slimcutt]

Wish we had a finance/investing forum...

We do in the interdisciplinary forum.

So, are you saying at the PT job if you contribute 5% of your pay, your employer will contribute...ahhhhh hell never mind. Contribute to both at least enough to get the match. 1.25% match is still worth it.

 

[confettiflyer]

1.25% is still like close to $2k a year free money at RPh wages....so yeah, why not just do both? $2k/yr x 30 years is like $60,000 + interest/gains, why not?

Slightly off topic, this sounds like an example of behavioral economics where someone will drive to another store 30 minutes away to save $10 off a $30 DVD set, but will not bother if it's $30 off a $250 home theater.

Just make sure *your* aggregate contributions don't breach the $18,000 limit set by the IRS (employer matches don't count against this, but they count against the aggregate $52,500 limit, but doubt many approach that in a year).

 

[mentos]

Slightly off topic, this sounds like an example of behavioral economics where someone will drive to another store 30 minutes away to save $10 off a $30 DVD set, but will not bother if it's $30 off a $250 home theater.

LoL I remember that example in my economics 101 class in undergrad. Saving $10 off a $50 video game is the same as saving $10 off a $300 PS2.

 

[confettiflyer]

LoL I remember that example in my economics 101 class in undergrad. Saving $10 off a $50 video game is the same as saving $10 off a $300 PS2.

Yeah I mean I get it....when I was out buying a car, they only ones they had in stock had some extra stuff on them (like maybe $500 worth I didn't care for), and I didn't bother putting up much of a fight.

Then you have me spending like 2 hours hemming and hawing about a $5 difference between lamps.

yeah I make total sense.

 

[akaykay]

I can reach the 18k limit with the PT job if I put most of my earnings there. I guess my point was should I just do that to get a better match even though the FT job has better funds in the 403? Thanks

 

[Momus]

I can reach the 18k limit with the PT job if I put most of my earnings there. I guess my point was should I just do that to get a better match even though the FT job has better funds in the 403? Thanks

Get the max match on both, the rest go to better funds carrying employer. Can you make 50-100% free money return on your contribution had you stick to only 1 employer? What's so confusing?