To Get the Full Employer Match, You May Need to Contribute Evenly All Year Long Hi Friendos, If you’re reading this, you’ve probably heard that you should really, really make sure to contribute enough to your 401k (or 403b) to get the full amount of any employer match. Let’s say your employer matches your contributions, […]
You May Have to Dig a Little to Identify Fees in your 401k. It’s a One-Time Chore so Get Out Your Shovel! Hi Friendos, I’ve written about minimizing investment costs in some prior newsletters. In a 2023 newsletter, I explained that a “low cost” fund is defined by having a low expense ratio. To me, […]
401(k) Summer School: You Won’t Owe Taxes If You Swap Investments Inside Your 401k Hi Friendos, 401k summer school continues and here on Flag Day we have a short lesson that brings positive news. Lesson 5: You will not owe any taxes if you swap investments inside your 401k. Let’s say you own Fund A […]
401(k) Summer School: Changing Investments for Existing Money is Different from Changing Investments for New Money Hi Friendos, In today’s installment of 401k summer school, we’re getting into some logistics of managing your account. Lesson 4: Changing the investments of existing money in the account is different from changing the investments for new money you […]
401(k) Summer School: It Helps to Be a Little Weird Sometimes Hi Friendos, Today’s third installment of 401k summer school is all about how being weird can be to your financial advantage. Being “weird” is often pretty helpful in personal finance, like doing a no-spend challenge as a New Year’s resolution, taking home all the […]
401(k) Summer School: You Can Change Your Contribution During the Year Hi Friendos, I hope you are having a nice Memorial Day weekend. Where I am, it’s been raining for 24 hours solid, so I’m staying inside, appreciating the coziness of being dry and only having to go out to walk the dog. This is […]
401(k) Summer School: Putting $ in and Investing It are Distinct Actions Hi Friendos, For the next several weeks, I’m going to write about aspects of 401k’s and other workplace retirement plans that are typically not discussed in financial writing or in workplace benefits packets, but commonly come up in discussions with my clients. Since […]
Hi Friendos, Last week I wrote about the maximum amount you can contribute to an HSA and an IRA each year. I said: “HSA and IRA contribution limits are separate from each other and from job-based account limits. In general, the max you can contribute across types of accounts is: HSA max + IRA max […]
Hi Friendos, The last few weeks I’ve discussed the benefits of saving for retirement into one type of tax-sheltered account vs. another. I wrote: “I believe the existence of such accounts is terrible policy and we should get rid of all of them!” Today I’d like to spotlight some research that supports my perspective. I […]
Hi Friendos, Today I will continue the discussion about types of tax-advantaged investment accounts, like 401k’s and IRAs, and how to decide which type of account you should put your money in. At some point, nearly everyone saving for retirement will grapple with whether to put money into a Roth account or a traditional account. […]
Hi Friendos, Today I would like to start a discussion about types of tax-advantaged investment accounts, like 401k’s, IRAs, and HSAs, and how to decide which type of account you should put your money in. I have always been a huge booster of such accounts, so it may surprise you to learn that I believe […]
Hi Friendos, This week’s topic is vesting and 401k matching. It sounds so sartorial. I’m going to walk through a very detailed (and boring) example of this with a 401k. This is a long one, so stay with me now! Setup: The matching part: So with this particular matching formula and your given salary, you […]
Frequently Taxed Questions 