REMINDER FOR ALL CVS RPHs -- Transition to Vanguard is this week.

[Momus]

I thought it was taxed just at a lower rate compared to when we get to use that money when we retire? Let me know!

The Case Against Roth 401(k)

Always max traditional 401k first.
Next, HSA if you are qualified.
Then, Back door Roth IRA.
Last, taxable account.

Indexing for 40 yrs will be better than actively picking stocks trying to beat the market. Vanguard doesn't grow from 0 to 5 trillion dollars in assets if low cost indexing doesn't work. Most 401k plans have some indexes to select from.

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[jjcayce123]

Vangard is great...80% large cap...20% mid/small cap. Im hospital but these are what I choose.

 

[jjcayce123]

Vangard is great...80% large cap...20% mid/small cap. Im hospital but these are what I choose.

I should have specified...
80% in Vanguard Institutional Index I
20% in Vanguard Small Cap Index Adm

 

[WVUPharm2007]

I thought it was taxed just at a lower rate compared to when we get to use that money when we retire? Let me know!

You don't have to pay income tax on 401k monies. You pay taxes on it when you are older and withdrawal. In a non tax advantaged account, you pay taxes on both ends.

 

[WVUPharm2007]

I should have specified...
80% in Vanguard Institutional Index I
20% in Vanguard Small Cap Index Adm

Warren Buffett's will instructs the executor to put all of the money into a plain S&P 500 index like the one you have 80% of your money in. I'd consider a bit of diversification with international funds, but you don't have to. It turns out that the biggest indicator of successful retirement planning more than anything else is saving early and often.

 

[Thoughtfulsinner]

Hasn't been touched on, but the main thing you want to do is take advantage of the ESPP that your company offers. Maxing out that at a discount of 15% has made my wife 335K just over the last 10 years. Thanks United Healthcare.

 

[Cleaveland]

The Case Against Roth 401(k)

Always max traditional 401k first.
Next, HSA if you are qualified.
Then, Back door Roth IRA.
Last, taxable account.

Indexing for 40 yrs will be better than actively picking stocks trying to beat the market. Vanguard doesn't grow from 0 to 5 trillion dollars in assets if low cost indexing doesn't work. Most 401k plans have some indexes to select from.

Awesome, that's a great guideline!

You don't have to pay income tax on 401k monies. You pay taxes on it when you are older and withdrawal. In a non tax advantaged account, you pay taxes on both ends.

Thanks for the clearing it up man. Really do appreciate it!

 

[mentos]

Hasn't been touched on, but the main thing you want to do is take advantage of the ESPP that your company offers. Maxing out that at a discount of 15% has made my wife 335K just over the last 10 years. Thanks United Healthcare.

Lucky for her. I maxed out CVS ESPP from 2015-2017 and I'm like -$5k... Should have put it all in an index fund instead and it would have been +$10-15k easily.

 

[jjcayce123]

**** cvs...i refuse to set foot in that generic **** box

 

[JanuviaGrl]

When choosing my paycheck deduction it gives me 4 options...

401(K) SAVINGS
ROTH
ANNUAL INCENTIVE
ROTH ANNUAL INCENTIVE

What is annual incentive and roth annual incentive? I was thinking that it is just the match but why does it let me choose a percent for it? And why would there be two options for the match since both just go under the "Safe Harbor Match"?

Will really appreciate it if someone can please answer this question. I'm need clarification on this too.

 

[JanuviaGrl]

Hi thank you for your helpful advises, taking that I logged in to set up my contribution.

Under paycheck deduction,
There is
401k 5%
Roth
Annual incentive
Roth annual incentive


I have 5% for 401k, I’m guessing when my enrollment is confirmed this is the 5% income taken from paystub that CVS would match?

So if I put 10% for that I would still get 10% deducted pre tax that u were saying but company would match 5% of that and I can do that until I hit 19k?

Also, for the other stuff Roth annual incentive Roth annual should what did u do left it blank?

I'm confused about this too. Someone please clarify.
Also just realized i have to open an Individual IRA account to contribute to. I just assumed the Roth, and Roth Annual Incentive were the Roth IRA accounts...

 

[WVUPharm2007]

I'm pretty sure it's just what percentage of your annual bonus you want put into 401k/roth 401k.

Or not. They do a **** job of explaining things to us.

 

[meanrx]

All the retirement target date funds consist of is Vanguard's total stock market and total international stock market with a bond index. It a very simple fund.

If you really want to go as cheap as possible, you could basically cobble together the same thing as the target date fund by going heavily Core Equity, which is just an S&P 500 fund (0.08% expense ratio) and International Equity Index Fund (0.11%) with a bit of Mid Cap Index (0.10%) and Small Cap Index (0.10%) and a small percentage of US Bond Index (0.09%). Doing this would save you ~ 0.1% points. Which, honestly, even after 40 years, wouldn't amount that that much. But I guess you could buy a Mercedes C-Class with the difference in the year 2050 or so.


I've actually decided to be like mentos up there. I'm just going with a majority in the target date fund with a bit in small cap growth and large cap growth because I like both of those funds. I'm setting it and forgetting it. My hope is that I only look at it once a year or so. The best way to screw everything up is messing with it.

I'm pretty sure it's just what percentage of your annual bonus you want put into 401k/roth 401k.

Or not. They do a **** job of explaining things to us.

how many funds can we invest in the HSA account, and are we allowed to change our funds from one to another without any fees??
Thanks

 

[WVUPharm2007]

how many funds can we invest in the HSA account, and are we allowed to change our funds from one to another without any fees??
Thanks

There are several choices of funds. I'm not sure how many. Like 15-20 or so? Not sure about switching funds, I've never switched them up on there.

 

[mentos]

Will CVS 401k ever offer Vanguard admiral funds? The 401k at my current job has them, thinking about rolling over my old CVS 401k. But if CVS will offer them in the future then I'll leave it alone.

 

[recycledpaper]

Jus wanted to bump this because it appears that CVS does not do "true-up" at the end of the year anymore, so make sure you are not front-loading your contributions because you could be missing out on employer matches later in the year.

 

[mentos]

Jus wanted to bump this because it appears that CVS does not do "true-up" at the end of the year anymore, so make sure you are not front-loading your contributions because you could be missing out on employer matches later in the year.

It's been that way for a couple years.

 

[STAR3URY]

Does anyone know if the target funds pay dividends? I can’t find any info