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Do I have an exact amount? No. Do I think you should be putting away the maximum allowable by law? Of course. Do I wish that I could sock away $12,000 a year? You bet. If you are able, consider yourself among the lucky 7% who do exactly that. 50 year olds are allowed to contribute $14,000 per year but apparently less than 5% do. The real question is what should you contribute and is it going to be enough. If your employer provides a match of any kind, take it. Many new employees who are automatically enrolled in their company's 401(k) or similar plan are given the impression or take for granted that the company has done something in their best interest. Often the default plan might not contribute a very high percentage and may be directed toward either the company stock of a money market account. Another interesting thing about these types of plans are the pre-tax deduction. In many cases, you can maneuver this deduction to allow you to take home what you need while increasing your savings. If your company matches 5% and you are enrolled, try taking 8-10%. Often, that subtle change in taxable income might actually change your take home pay very little while increasing your nest egg. Keep taking more out in small increments until you reach an equitable living arrangement with your paycheck. You take home what you need and you save more. With 85% of Americans suggesting that retirement savings is a concern, it is amazing that so little time is taken to figure out how to best take advantage of all the available plans. [ Close Window ] |