Please Scroll Down to See Forums Below
i DO NOT! undestand 401K stuff
- Thread starter Smurfy
- Start date
I have a hard time finding these threads. PLEASE write 'gonelifting' in them somewhere. thank you.
and contribute AT LEAST an amount that the employer will max match. Personally, I would contribute the most you can possibly do.
I'd also look into a Dependant Care Account. It may be called Child... something. If your kid goes to daycare or after school programs, you can pay for it with pretax dollars. Same goes for Medical Savings account. You pay with pretax dollars for any out of pocket money you pay that the insurance does'nt cover. It's all money. Do it.
and contribute AT LEAST an amount that the employer will max match. Personally, I would contribute the most you can possibly do.
I'd also look into a Dependant Care Account. It may be called Child... something. If your kid goes to daycare or after school programs, you can pay for it with pretax dollars. Same goes for Medical Savings account. You pay with pretax dollars for any out of pocket money you pay that the insurance does'nt cover. It's all money. Do it.
I plan to contribute at least as much as my company will match, that's a no-brainer. As far as dependent care/FSA, we are signed up for that through Lumberg's employer (the government so it's awesome benefits there).gonelifting said:
It's just that on this 401K enrollment form they ask you what %age you want in what fund, etc. And they list about 15 different ones. I have no idea what they are. I supppose I need a booklet that explains each one in detail, including what their risk is blah blah but I dont have that! HR lady only handed me the enrollment form and nothing else! wtf this is why Im frustrated.
KillahBee
New member
Smurfy said:
I had this same problem. your company should have had an intro to the 401k meeting with the financial institution that the 401k is thru. call the advisor from that meeting (or get the contact info thru your HR dept) and talk to it with him/her. they'll ask you questions about your life, finances and general thoughts in investing styles and give you a plan
Smurfy said:
Great. You may want to lean towards income producing funds or funds with higher turnover, dividend payers, etc. for tax purposes. This is assuming you have a well balanced portfolio of growth and income producers/tax inefficient funds and investments. The theory is since the 401k grows tax free, then you'd want that money in there, while the efficient growth type stocks/funds are in your taxable account(s).
yeah sometimes they do things in a rinky dink fashion around here. when i started, they sent me a huge package with all these HR forms and stuff and the day I started I was expected to have it all complete to turn in, but no one sat down with me at all to explain any of the benefits. it was kind of bullshit IMO. at my last employer we had new hire orientation with HR on the 1st day of employment which lasted 4 hrs and explained all the benefits in detail. people need that
I might go down to the head of HR right about now (good Italian lady) and get this worked out or else bust some jaws.
I might go down to the head of HR right about now (good Italian lady) and get this worked out or else bust some jaws.
Smurfy said:
I would sit down with you smurf. I would sit with you for 4 hours. I love you.
B
BrothaBill
Guest
It really is a savings account to help fund your retirement.
The dollars you place into a 401K are granted certain tax speciaites up to a certain limit. You put money in on a "PRETAX" basis. This this grows "TAXDEFERRED"
Which means that each year instead of the government making you pay taxes on your savings, that money stays in the account and the interest on that money will then "COMPOUND".
Over time, the money in the account will grow much more rapidly b/c of these certain tax breaks.
You cannot use the money until you approach retirement age, if you do so, then you will also pay a penalty of 10% for early withdraway. Plus, at that point, you pay the taxes on the savings then and you pay it at your current tax rate.
Usually, when people retire, they will be in a lower tax bracket so this makes for them.
You really should put together a sound financial plan.
The 401K is just an account of money, what "You" choose as a funding vehicle, be it mutual funds of what type or quality depends on your age to retirement and your tolerance of risk. A person who retires in thirty years can be in more aggressive funding vehicles and ride out any rollercoaster than someone who is say retiring in five years. They would want to be in more stable investment funding vehicles.
But, there are lots of accounts and different financial options available all suited to a person's individual needs wants and most importantly their financial goals in life.
Different tax advantages blended with different insurances etc....
You should have a sound financial plan done for you and have that in place as a template that will help you decide on what to do at work and what other stuff given your budget and goals.
The wisest move is always take advantage of the employer match of what you contribute to your 401k retirement account. Like if they throw in five grand if you put in five grand. Well thats like a five grand raise right there for you.
It really is easy once you get the hang of it.401k retirement accounts are just piece of a sound financial plan
The dollars you place into a 401K are granted certain tax speciaites up to a certain limit. You put money in on a "PRETAX" basis. This this grows "TAXDEFERRED"
Which means that each year instead of the government making you pay taxes on your savings, that money stays in the account and the interest on that money will then "COMPOUND".
Over time, the money in the account will grow much more rapidly b/c of these certain tax breaks.
You cannot use the money until you approach retirement age, if you do so, then you will also pay a penalty of 10% for early withdraway. Plus, at that point, you pay the taxes on the savings then and you pay it at your current tax rate.
Usually, when people retire, they will be in a lower tax bracket so this makes for them.
You really should put together a sound financial plan.
The 401K is just an account of money, what "You" choose as a funding vehicle, be it mutual funds of what type or quality depends on your age to retirement and your tolerance of risk. A person who retires in thirty years can be in more aggressive funding vehicles and ride out any rollercoaster than someone who is say retiring in five years. They would want to be in more stable investment funding vehicles.
But, there are lots of accounts and different financial options available all suited to a person's individual needs wants and most importantly their financial goals in life.
Different tax advantages blended with different insurances etc....
You should have a sound financial plan done for you and have that in place as a template that will help you decide on what to do at work and what other stuff given your budget and goals.
The wisest move is always take advantage of the employer match of what you contribute to your 401k retirement account. Like if they throw in five grand if you put in five grand. Well thats like a five grand raise right there for you.
It really is easy once you get the hang of it.401k retirement accounts are just piece of a sound financial plan
chewyxrage
New member
Smurfy said:
If you don't want to bother too much with it, go with an index fund and an international fund. Maybe a small cap fund/growth while you're at it. If you keeop those three indefinately, you should be fine.
B
BrothaBill
Guest
Smurfy said:
Sure but I still thinking you should have a written financial plan. Goals, budgets etc.... professionally done. I guess it really depends on the level of need of financial planning. And really, a skilled financial planner may just help listen and clarify what you want. Then, they will recommend the strategies for achieving it.
There are fee-based planners and there are commission based planners and most importantly they are objective of your situation. Plus, you can have peace of mind that you have good financial health, just like seeing a physician and they take that burden off of you and Lumberg so you can rest easy.
The biggest problem that people get into is not having a sound financial plan, appropriate cash reserves and line of credit for emergency. THen protection to their financial plan in insurances, then the appropriate ratio of fixed assets vs equity assets and in what funding vehicle those are located under as well.
It can be quite complex for someone that doesnt work in it day in and day out to make the right decisions.
Like putting taxfree municipal bonds into tax deferred accounts, turning a low interest tax free bond into taxable monies. Stupid mistakes like that people seem to come up with
