Maxing out 401k contributions

Discussion in 'UPS Retirement Topics' started by Tough Guy, May 8, 2016.

  1. Tough Guy

    Tough Guy Active Member

    Have any of you, or do any of you currently, max out your 401k contributions? And if so, when you're approaching the max, does the payroll department, or prudential oversee making sure the exact dollar amount isn't exceeded? Or would it be my responsibility to change my contribution rate to 0 when I see I'm about to max?
  2. Jackburton

    Jackburton Gone Fish'n

    Your contributions will stop once you hit the max, which is 18k this year. You don't need to do anything, it's automatic.
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  3. UpstateNYUPSer

    UpstateNYUPSer Very proud grandfather.

    There is a "catch up" contribution for those of us 50 or over---this year I believe that limit is $6K, for a total limit of $24K.
  4. NonDeliverOtherMissed

    NonDeliverOtherMissed Active Member

    I got 5% in 401 n 5% in this smart? I know nothing about it just know I needed to get it started... I've had it for about 5 years now but I hear different things from different ppl what to do so I just left it alone...
  5. NonDeliverOtherMissed

    NonDeliverOtherMissed Active Member

    Also do any of u invest in stocks? If I'm correct this is a whole dollar amount deduction from your paycheck opposed to a percentage...what's a good weekly deduction ..$50??and can u cash out the stocks whenever u want?
  6. UpstateNYUPSer

    UpstateNYUPSer Very proud grandfather.

    Are you talking UPS stock or stock from any company?
  7. By The Book

    By The Book Well-Known Member

    Sounds like UPS stock, and it's a good buy and hold with the discount you get to purchase. It also pays a dividend so you will have earnings paid to you...just don't forget to report it on your taxes.
  8. upschuck

    upschuck Well-Known Member

    I'd rather take the 5% hit now, and put in Roth, 2 years, you've made your money back.
  9. By The Book

    By The Book Well-Known Member

    I was just trying to help the lad out. I'm not too aggressive when it comes to investing. I like making money though.
  10. Monkey Butt

    Monkey Butt You can call me Chappy Staff Member

    Stops automatically.
    I maxxed out 401k the last 22 years with company. I had no UPS stock in it for the last 10 years or so.
    Roth is better if you are under 45.
    UPS stock is a decent buy and it is easy to buy. Dividend is 2.5 - 3 % annual which is OK but not great.
    Long-term advice
    Since your pension and maybe medical bridge to Medicare is dependant on UPS, don't get too overloaded on UPS Stock.
    I'd say, no more than 10% of your investments.
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  11. Notretiredyet

    Notretiredyet Active Member

    Been putting 22% in the 401k and max it out by Nov every year. Also been maxing the Roth out by putting an additional 10% on that as long as they've offered it. I'm outta here in spite of being in the CS pension plan at the end of Jan 2017. It all started with $6 a week in the UPS Thrift plan back in 79 when a coworker convinced me to sign up for it. Start early and put as much as you can and you can have a plan b like mine. You're gonna need it.
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  12. hardcharger

    hardcharger Member

    Hey monkey butt why do you say Roth is better if your under 45?
  13. olroadbeech

    olroadbeech Happy Verified UPSer

    do a search here on investing in the 401k. invest as much as you can in the roth. start at say 10% for about 6 months and see how that goes. then raise the percentage as you go along. you'd be surprised on how much you won't miss the money if you are prudent in your finances.

    also it is fun to see it grow. some years my 401k increased more than what i made. if you max out early and go 25-30 years you may have over a million dollars . the 401k website has calculators that will show you how much you may have at retirement.

    a little bit of homework now as you are doing will pay great dividends years from now.
  14. MC0493

    MC0493 Active Member

    Good read, any advice for someone who just got started working at ups? I'm only 22 but i know there is no better plan than to start saving early.
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  15. Brownslave688

    Brownslave688 You want a toe? I can get you a toe.

    I look at my $50 a week for ups stock as a savings account pretty much. No bank savings account is gonna give me 5%+ return.
  16. olroadbeech

    olroadbeech Happy Verified UPSer

    all you have to do at 22 is to save 230 dollars a month and you'll have a million dollars at age 67. just think what you'd have if you saved more . ( source. retirement calculator )
  17. You have the power of time compounding.
  18. twoweeled

    twoweeled Active Member

    I maxed out when I was working. I strange thing occasionally would happen in addition to cutting it off at the max. Ocassionally I received something (I think from IRS) stating because of some equality rule (best I could understand), I would get part of my 401K contributions returned. I'm thinking it was in the $3000 range. I still don't get it.
    But they always cut it off when the max was reached.
  19. Jackburton

    Jackburton Gone Fish'n

    It's called HCE rules, were you management or a driver? Either way you had to have been in the top percentage of your 401k's earners to be restricted below the governmental limits for the year. I experienced this for the first time last year.
  20. Penalize the savers.