Every year when we get a raise I always try to up my 401K so I never really miss any money. My current 401K is at 20% per week. Now if I can only make it to retirement life will be good.
HAPPY NEW YEAR EVERYONE
I am starting to focus once again on my 401k as the last of the loans that I took out to help pay for my children's college was just paid off. I took out 8 loans during their school years, with each loan 1 year in length (some of the loans overlapped). I am at 15% w/$45k. The tax benefits are outstanding, as the amount that you have withheld comes right off of your gross income and thus lowers your taxable income. I also adjust my withholdings to ensure that my take home pay remains stable and I have just enough taxes withheld so that I do not have to pay in. I hope to increase it to 25% by age 50 (4 yrs) and also hope to take advantage of the additional $5k in "catch-up" contributions allowed by law. My plan is to have at least $100-150k in my 401k by the time I retire. I will couple that income with my expected $6k/mo pension (less 16% to the ex) and Social Security, which will make up for the 16% in lost pension.
When I was in management (pt), I used to only invest the maximum amount UPS would match. Now that I am an hourly (ft) and dont get a match, I am investing the pre-tax maximum. I also have a roth IRA. It's not easy though, especially since I'm on the extreme low end of the progression scale being an outside hire. Good thing I'm still in "broke college student" mode and still have a diet that is dependant on Ramen Noodles. I'm only 22 so I have a long way to go until I retire . I figure once I get a family and "real" expenses (house, kids, etc...) I'll have to tone it back down to about 15%.
. . .We use to have what they called a Thrift Plan. You could only put $6 a week into it. That is only $240 a year. . .
I am starting to focus once again on my 401k as the last of the loans that I took out to help pay for my children's college was just paid off. I took out 8 loans during their school years, with each loan 1 year in length (some of the loans overlapped). I am at 15% w/$45k. The tax benefits are outstanding, as the amount that you have withheld comes right off of your gross income and thus lowers your taxable income. I also adjust my withholdings to ensure that my take home pay remains stable and I have just enough taxes withheld so that I do not have to pay in. I hope to increase it to 25% by age 50 (4 yrs) and also hope to take advantage of the additional $5k in "catch-up" contributions allowed by law. My plan is to have at least $100-150k in my 401k by the time I retire. I will couple that income with my expected $6k/mo pension (less 16% to the ex) and Social Security, which will make up for the 16% in lost pension.
Ms Spoken has the right idea, I hope that I can get there some day. I am embarrassed to admit that I didn't join it until a year ago, starting at 7%. I do have some Mutual Funds and an IRA I started back with the IPO when UPS Stock went public. I haven't bought any UPS Stock since, the Mutual Funds seem to do better. I started with putting money in the Russell 2000 Fund, but I stopped that a couple of months ago. The S&P 400 and EAFE International Funds are doing better, thats where I am now. I am going to increase my contribution amount this week. I am pretty much the only one working in my household, my wife is legally blind with RP and only works PT. If you are able to put 20% in the 401K, I would do it.