Category: 401K
-
2006 and 2007 401k Contribution Limits
Sometimes I like to post information that I think will be of use to me (and others) sometime down the line, this is one of those posts and this one is about the 401k contribution limits for 2006 (you can’t do anything about your contributions for the rest of 2006 now, unless your HR/benefits department…
-
10 Rules: Use Your 401K
This is the second tip of the ten in Forbes ten rules to building wealth and it works nicely with rule 1: start early, because contributing to your 401K should be an automatic decision when you start a new job. I don’t want to beat this discussion to death, because every personal finance blogger has…
-
Don’t Borrow From Your 401(k)
One of the often quoted “nice things” about a 401(k) is the fact that you can borrow from your 401(k) up to $50,000 or 50% of it’s current assets. What’s nice about that is the fact that while you do pay interest, you’re paying it to yourself so it is in effect an interest free…
-
Pay Debt Or Save For Retirement?
Should you pay down your debt or save away for retirement? It’s a tricky question and it all depends on what kind of debt you’re talking about and what kind of retirement funds you’re contributing to. Let me illustrate this with two different examples. John Smith has lived a very lavish lifestyle and is now…
-
What Is A Highly Compensated Employee?
A highly compensated employee is a construct of retirement plans and it’s used to determine if a retirement plan is biased towards these highly compensated employees. Those plans that are biased lose favorable tax advantages for those retirement programs, those that demonstrate that they are not biased towards these highly compensated employees will qualify for…
-
Reasons To Take The Lump Sum
When it comes time to cash out your retirement, it usually comes down to a decision of whether you want to take a lump sum or income for life (or a mix of both). Here are some reasons why you should consider a lump sum. 1. You can control your investments If you take the…
-
Max Out Your 401(K) As Early As You Can
In my first two years of full-time employment, I contributed the maximum amount to my 401(k) plan because I still had the college mentality. I wasn’t used to making money and as such I wasn’t used to spending it, so in a very miserly fashion I jacked up my 401(k) contribution so that my annual…
-
401K Automatic Enrollment Legal Issues Resolved (Maybe)
One of the reasons why employers haven’t automatically enrolled employees into retirement plans is because they didn’t want to be liable in the event that the investments the employers chose performed poorly. Well, in proposed regulations by the Department of Labor last month, employers won’t have the worry as long as they offer these three…