Michael on January 8th, 2008
Bookmark and Share

Yesterday, I posted a question about the Roth 401(k) plan. While this follow-up question was written about a Roth 401(k), the truth is that the same logic holds for both Roth 401(k) and a regular 401(k):

You: I have another question. Or maybe it’s just a matter of ethics. I’m not sure how much longer I’m going to stick around this job. It’s just getting to the point where it’s hard to pull the long hours for something I don’t really care much about. However, I’d like to get the matching $2000 that my company offers. I’d like to condense my payments into the next 6 months instead of the whole year — do you know if that’s done?

Accelerating your 401(k) contributions

There’s no ethical dilemma here. Even without the intention of leaving, it’s always a wise financial move to get money sooner (time value of money, chapter 1). Most companies will match as you contribute (each paycheck) and stop doing so when you hit the annual limit. However, there are some companies who will do it straightline throughout the year. Obviously, I don’t know where your employer falls. However, you may be able to tell simply by looking at some of your December paystubs and 401(k) statements if you exceeded the matching amount in 2007.

It’s your money. Go get it!

Bookmark and Share

Leave a Reply

You can use these tags: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>