Five percent
Posted on February 5, 2006 7 Comments
I just increased my 401K contribution to 5 percent… I’m maxed out!
For those of you new to retirement savings, companies usually offer to match a certain amount of money that you contribute to your 401K plan. My company matches fully up to 3 percent, and then half of my contribution at 4 and 5 percent. So, by increasing my contribution to 5 percent, I’ve “maxed out” my employer contribution. This is a good thing and a goal you should all be working towards if you can do it.
My 401K is currently just under $5,000. At 26, it should probably be bigger but the good news is that I started contributing at 24 so I have a long time to grow the balance before I retire at 65.
Here are some of my previous posts on retirement savings if you’re interested to read more about my journey:
Also, look online for calculators that can estimate the value of your 401K years from now to determine whether you need to invest more. Start at bankrate.com and look for more online.
Keep on savin’!
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February 5th, 2006 @ 11:20 pm
Well done Nicole. It’s much better to start saving for retirement while your young. The more you can save at this age will compound well into the future and grow into a sizeable retirement cash-cow.
Great blog too.
February 6th, 2006 @ 1:56 am
That’s a great company match. Mine is behind the times. It only matches my first 4% and then only a quarter on the dollar.
February 6th, 2006 @ 2:22 pm
WTG! I am 31 and just starting on mine so I think you are doing great.
February 6th, 2006 @ 3:36 pm
Just remember, you are not maxed out just because you company doesn’t match any higher percentage. So don’t stop there. continue to add as salery increases.
February 8th, 2006 @ 4:36 am
Great work! Luckily at 23 I’ve been able to contribut to my retirement and get part of it matched by my employer as well. It’s amazing what 40 years of interest will do to a couple hundred dollars!
Check out my new blog at http://quarter-lifecrises.blogspot.com for more information about saving your money (see ‘Saving for the Future’).
Keep up the awesome blog!
February 16th, 2006 @ 6:40 pm
Congratulations.
Hopefully you can contribute beyond the minimum for full matching soon.
Doing well… Keep increasing the percentage by 1 or 2% every time there is open enrollment. You will not even feel it… until you need it.
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