401K... what do you invest each month? WITH POLL

I guess this might be a personal question so you can anonymously take the poll if you'd like.

I'm still in college so I don't know much about this but FH just started working and he's investing $400 each month into this 401K thing!

It just seems like so much! PLUS his company is adding a small % to it each month as well.

Do you think that's too much? He just turned 24 and I'm 21 so in my opinion, he should be investing that kind of retirement money later on! Do you agree? I'm trying to figure out what the average retirement investment is per working person

Thanks in advance everyone

your FH is very smart, you should definitely do that asap.

The earlier you invest the more you will have in the long run.

Check out this calculator. Try punching in #s and see what you get if you start at 21 vs. 30 yo.

http://www.bloomberg.com/invest//calculators/retire.html

It's never to early to invest in your future, 15% is a good goal to shoot for.

I did that with my money and I can honestly tell you I thank god that I had the foresight to invest early. I'm now so much better off than all my friends and family (even the older ones) 'cus I have a nice retirement account that will provide for me even if Social Security goes bust.

your FH is doing a good thing by investing that money! i know it seems like a lot now....and you think 'we have soooo much time til retirement' but it's a common misconception. ppl think they can put more in later...and then mortgage payments, car payments, kids, school, etc. get the better of you. remember that if he puts money in early, he can let that money accrue interest--and possibly lower his contributions in later years, when there are so many other things to have to pay--but still have lots of cash collecting interest.

401K is a good investment, but i would also recommend looking into whole life permanent insurance policy. there are some great tax deferred savings involved in a whole life policy vs. a 401K or IRA. he should talk to his financial advisor.

It TOTALLY depends on how much money you make.

I max out at a contribution of 14,000 per year into my 401(k), but that's less than 10% of my gross income, so it's not debilitating for me. In fact, it's GREAT for me to contribute more to my 401(k) to get the tax benefits - since I have relatively few deductions in my profession. (Also, I have no company matching at my firm!)

I think $400/month is a great contribution to be making, UNLESS it's seriously impacting your ability to live. Saving for retirement early is important - plus, it's security in the event of an emergency later in life!

I tend to be conservative in this respect and opt for saving more and living beneath your means. If, however, you really need more money to live on -- or more money in savings that is more easily accesible, then you might decrease your contribution. Again, it's really difficult to say without knowing the total picture. I tend to wholeheartedly agree, though, that this is a good thing, not a negative!!

In general, more into the 401(k) the better... but there are always exceptions!

invest as soon as you're old enough to.

the trick with a 401k is to max what the company will match.

example: that means if his company will only match HIS 6% with THEIR 3%. then that is the max where he's seeing a tax and investment benefit. after than, he should put the rest he feels comfortable investing into something else that makes sense for him/you

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Posted by eden

your FH is very smart, you should definitely do that asap.

The earlier you invest the more you will have in the long run.

Check out this calculator. Try punching in #s and see what you get if you start at 21 vs. 30 yo.

http://www.bloomberg.com/invest//calculators/retire.html

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Thanks so much for the link! After a few minutes of trying to figure out what it all meant, I see the difference.

Yea...I guess it's one of those things that'll be a pain now but worth it later! Thank you eden.

my company doesnt match a thing! I only invest like 3 percent right now till after the wedding!! i cant afford anything more then that right now

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Posted by MJDoc12

your FH is doing a good thing by investing that money! i know it seems like a lot now....and you think 'we have soooo much time til retirement' but it's a common misconception. ppl think they can put more in later...and then mortgage payments, car payments, kids, school, etc. get the better of you. remember that if he puts money in early, he can let that money accrue interest--and possibly lower his contributions in later years, when there are so many other things to have to pay--but still have lots of cash collecting interest.

401K is a good investment, but i would also recommend looking into whole life permanent insurance policy. there are some great tax deferred savings involved in a whole life policy vs. a 401K or IRA. he should talk to his financial advisor.

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Good point... we'll have way more expenses later. I feel sorta bad for complaining about it to him now He's always been good with $$ and responsibility so maybe I should just let him do his thing!?! I'll mention the life policy to him. Thanks

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Posted by Kara and Todd

I tend to be conservative in this respect and opt for saving more and living beneath your means. If, however, you really need more money to live on -- or more money in savings that is more easily accesible, then you might decrease your contribution.

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I guess I'd be okay with living beneath means if we were older or more stable. Though his salary is great, we have lots of student loans, a house to save for, and a wedding coming up.

At least like you said, it can be decreased later if necessary. Thanks

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Posted by MandG072909

I think its a good idea to start w/ at least the perecentage that the company matches...see how it works out and then increase if it feels comfortable.

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Now that I've calculated it, that's exactly what he did. He's investing almost what the company has matched. I think...

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Posted by libby2595

invest as soon as you're old enough to.

the trick with a 401k is to max what the company will match.

example: that means if his company will only match HIS 6% with THEIR 3%. then that is the max where he's seeing a tax and investment benefit. after than, he should put the rest he feels comfortable investing into something else that makes sense for him/you

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Hmmm... I think I'm confused with all these #s now lol, I've always hated math. I'm gonna ask him exactly how it goes tomorrow. Thanks :)

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Posted by chrissyandvin

my company doesnt match a thing! I only invest like 3 percent right now till after the wedding!! i cant afford anything more then that right now

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That ***** that they don't match. I'm sure you'll be fine though. When I start working as a nurse, I don't plan to invest as much right away since the wedding will be coming up... but after the wedding I'll increase it.

LoL I guess that was too explicit for LIW I just wrote that 'THATsucksTHAT they don't match.

I look at it this way, if your company is matching or contributing anything, MAX IT OUT if you can. Also it is tax deductible, so I have always looked at it as more money for me and more money any bank would ever give me on my money.

I have been doing it since I was 18 and I am 31 now, I love having that cushion there for my future.

If it is not going to impact your daily life, do it while you can.

We both max out our 401(k). We didn't have this option early on but now that we are offered it, we do it.

Since social security probably won't give us much to live on, we are contributing as much as we can now to the 401(k). We also have a individual IRA.

The earlier you start, the better. Get into a savings plan that you can live with. Better to start saving more now because it will always be something. First you need the money for a wedding, then the house, then kids, then the vacation..etc..it's never a good time you think but it's so crucial.

I max out mine as well, so does FH. I know that alot of people think they should wait until they are settled to start contributing.

DON'T

Here is why: You will look at your first paycheck and figure out how to live off of that. You will adjust your life according to it and live within your newly set means. Now 6 months later you decide to start paying into it and you need to readjust your life. Live off of less money and try to lower your means. If you just start off with them taking the max, you never know the difference. When you get a raise it will adjust your amount withheld. You never have to readjust your life.

JMO