Retirement Plan

hz80408 · January 2011

Do you have one? Does DH have one?

If so-what do you have? and why/how did you decide on it?

If not-is there a reason why?

(Background: DH doesn't have one b/c his company doesn't offer a match to a 401K. Trying to convince DH that it's important to have something..)

[Poll]

chelley599 · January 2011

We are in limbo right now...my DH had one and all kinds of stock options. I on the other hand am not sure what I have. I know that we have a pension (they dont match anything) but it is about to be frozen. There are all kinds of meeting about it and I just don't understand any of it. I am looking for a new job and when I get one, I am going to focus on that. My friend works for Fidelity doing this type of thing so I am going to talk to her and figure it all out

christieep · January 2011

I chose other, I am a public school teacher and we have a state teacher retirement plan. I plan on supplementing it with an IRA. As soon as Ken and I get all of our new bank accounts sorted out I will probably be looking into that.

hz80408 · January 2011

I actually have 2 401Ks. I was lucky/blessed that I had a (re-occuring) paid internship that I became vested in the company my last summer. Granted, I only deposited into it for about 4 months, but the company matched 300% up to 6% of my salary. With calculators, that money along should be worth about 5 times what it is right now.

And my current/first job: we have a pension plan in addition to a 401K.

Patineuse1124 · January 2011

DH has a 401K which he puts in 10% (or maybe less, but then with company match it's 10%). I'm in grad school, so I'm not saving anything towards retirement right now. I did have a 401K at the job I had before grad school and I had to roll it into an IRA after I left. Once I have a real income again I'll dedicate about 10% to retirement savings. At the moment we are saving up for a house, but once we buy a house we want start an investment portfolio. While that won't be exclusively for retirement, ultimately it will probably go towards retirement.

Hannah, you two are still pretty young, so it's important to start saving now, even if it is just a little bit. Thanks to the way interest compounds $100 saved now will be worth a lot more than $100 saved later in life. What I find helpful is to start with a small percentage (since it's pretax you don't really even miss it) and then when you get a raise increase that percentage because then you don't notice it's missing from your check. If you need help convincing DH find an example online where they show the difference between starting retirement savings in your 20s vs later on, those are pretty eye opening.

dawnmhayden · January 2011

I have a pension through my job in the schools and I also started a Roth IRA a few years ago. DH has a 401K that his company contributes very little to and he also has a Roth...

hz80408 · January 2011

Karen - thanks for the insight. I started working fulltime the summer I was 18 and since then it's been drilled in my head to save for retirement and I've done so.

My current company (and first fulltime job out of college) matches up to 6% once you're vested (which takes 5 years), so I'm currently only putting in 4%. My thinking is that I am so young (24) that I can use that 2% difference to put into my home savings, then once we buy I'll increase to at least 6% for the 401K.

What do you think? Hmm, maybe I should ask MM board that too.

I just need to do like a powerpoint and some research to present to DH and get him to see how important it is.

nfp147 · January 2011

We both work for government and have excellent pensions, so we're pretty lucky.

hutchsl · January 2011

hz80408:

My thinking is that I am so young (24) that I can use that 2% difference to put into my home savings, then once we buy I'll increase to at least 6% for the 401K.

You can borrow money against your 401K for a house purchase. You may want to check out your plan to see the rules and regulations for this. I would put the full amount in.

I am fortunate. I work for the government and have a great pension plan. In addition I have always saved money in an investment account and I contribute the max to 401K even though there is no matching.

I am considerably older than you. We plan to retire in 13 years. But I started all this with my job after college.

kjhharris · January 2011

We both do 401K and max it out each year - DH has been maxing it out for years, whereas it took longer for my salary to get high enough to do so and I wasn't eligible to participate for the first 18 months after I joined my current company.

I have a small amount (less than $5K) that's still being controlled by my previous company - I really need to get on the ball with getting that rolled over to a IRA of some sort... New Years resolution

Mia2700 · January 2011

We are very blessed to both have 401k plans that our companies match up to 6% and we both have pension plans.

I've been contributing for 6.5 years now, so I've got a nice little nest egg brewing. Mike has been contributing for 4 years now, and he contributes more than me so his is growing nicely as well.

Since both of our first "real" jobs werein finance, we learned very early the importance of these things, so we don't take them lightly. We currently max our contributions to make life easier later on.

We also both have two life insurance policies each, one term one perm each. Also learned how very important this is, so we got it at our "young/healthy" age that way the price is cheap!

hz80408 · January 2011

yay, just updated my contributation to my 401K to 6% since company matches up to 5.5%.

Now for DH...

EDIT: hutchsl, I don't want to touch my 401K, I'd rather not be penalized for taking out of it and honestly btwn the 2 I have very little money in there to use anyways. We're better off waiting a few more months to save a little more than touching the 401K. Thanks for the thought though

msmerymac · January 2011

I have a 401k and a Roth IRA. My roth was created when I rolled over a 401k from my old job, actually. When/if I'm back in school full time, the only thing I'll have for 5 years is the Roth - so I'll have to max it out. My company doesn't match my 401k contributions. :-(

Oliver has a 401k and a traditional IRA because he can't qualify for a Roth.

Eventually, once we have our emergency/savings in order and buy a house, we'll start investing in mutual funds on top of that and open college savings/investment accounts for our kids.

aleanette · January 2011

I have a mix of stuff... I have a 401k, IRA, and some traditional savings (for a rainy day/house shopping)

I've had a 401k since 2006 when I started working at a bank, and I've always put 5% in to the 401k because that's how much my employer would match. When I left that bank to work at my new bank, I originally left that alone (as well as the Pension fund that my employer had established for me), but I found out that once you leave the company, they usually start charging administrative fees... so I did a direct rollover/transfer to my current bank and invested those funds into a IRA CD (so that I can take it out without any additional penalties in case I need the funds) and then yea, I have a regular savings and 401k with my new company.

DianaRuss2010 · January 2011

Hannah: Personnally I think that it is very smart of you to start thinking about your retirement now instead of later. If you don't make it important now, it will just keep being put off. I wish I would have been able to start my 401k earlier than what I did, and I'm only a couple years older than you, but I am hoping to retaire by 55! Fingers Crossed! I want to be able to enjoy my older years!

rccola1981 · January 2011

I think what I have is a Roth 403b which is the school district equivilant of a 401k...as a teacher I also have the teacher penion...DH has a government pension, I try to convince him to form another form of retirement

hz80408 · January 2011

Thanks Diana! I have always been told to start as soon as you can. I figure, I really don't need that "extra" money and I'd probably spend it on stupid stuff anyways.

Someone from MM board gave me this link and it's really kind of insane what a difference 10 years makes for compounding interest:

http://www.darwinsfinance.com/start-investing-today-amazing/

Retirement Plan

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