New Employees Confused Setting Up 401(k)

“You should contribute 6% so you are getting the full match which would be a total of 3.5% of the money you make from the internship Money can be easily rolled to a Roth IRA after you leave, most of the time you just click a few buttons and type in the account number You should also become contributing the max, 7500 to a Roth IRA each year with that income”

“Currently a junior, doing a fall internship. The internship has a 401k match, matches 100% of your contributions up to 1% of your annual compensation, plus 50% of the next 5%. Wondering if I should be putting money here or roth , also worked an internship this summer, so my total taxable income this year will be in the 60-70k range, not sure where that puts me mathematically and where I should be putting the money. Also new to 401ks, so wondering how much of a hastle it is that this account will”

“Im currently hitting the max 401k contribution for the year and Im wondering if I should be putting it fully in Roth 401k or is theres a certain split I should be doing to minimize taxable income. Also, Im wondering if I should be saving a bit less: Age: 27.5 Industry: Refining Salary: 121k with 12% match, pending RSU vest of 8k in March 2027 Net worth Breakdown: 364k Roth 401k: 147k (i max for the year, employer does 13% Roth IRA: 50k (max for the year) Robinhood Taxable Brokerage: 57k (700/mo”

“We are married, 38 years old, no kids, homeowners. We both have 401(k)s and we each contribute 10% plus an employee match of 4%, but we're still pretty far from maxing our contribution. Our combined 401(k) balance right now is around $400K. We currently have no investments beyond that. I think we're in a good position, but I also think we could be a little better invested. I'm planning to move our cash out of traditional checking/savings into an HYSA, and use some of it to open Roth”

“It should perhaps be noted that any income contributed pre-tax to a qualified employer plan would not count as earned income for IRA purposes—like, if someone earned $11,000 total but had 25% of that deducted for a traditional 401k, their IRA contribution would be limited to $8,250 for the year. W-2 box 1 is what you'd want to be looking at.”

“Many companies now automatically enroll employees (following thaler’s nudge principles) ; you should be able to stop or decrease future contributions through either your payroll/benefits department Changing contributions does not impact the account and its current value or previous contributions”

“If you get any employer match, do not opt out of that. It’s free money. Make sure you are depositing the employer match amount at minimum.”

“Absolutely max the free money your company gives you, then max your Roth if possible”

“Hey all. I am 40, making 95k/yr with bonuses on top of that, but I’ll just stick to the 95k for now. I am at 8% contribution to 401k with employer match of 100% up to 4% and then 50% up to 6%. I also have my Roth IRA that I max out. Car is almost paid off, have 4K left on that and it will be paid off in a total of 2 years, was really aggressive with the payments. I have a HYSA with 10k in there. What else should I be doing with my money to maximize any returns? I will also have an additional 700”

“Hi I just got a big boy job with a 401k match that I plan to max out. My question is, why do many people suggest maxing out your Roth IRA after hitting your employers contribution match, wouldn't putting those extra 7k in the 401k increase your gains over time a lot more, since the 401k will have a larger amount of money. In 5 years 401k would have 70k from my contributions + employee match, then if I put the money I would out in a Roth IRA it would sit at 105k. Conversely, due to the cap th”

“Realizing I’d have to contribute 24,500+ to 401k without match for the year to my 401k to even qualify. Curious what others are doing in initial years of big law. Know retirement is important but, in this economy, seems better to save for a house than put up to 70k in a mega backdoor Roth. Thanks! submitted by /u/Warm-Sprinkles-8086 [link] [comments]”

“You should want the loan over a distribution. It’s probably a lot cheaper. Not ideal, but cheaper.”

“yes. they are retirement funds. the goal is to keep the money in the account until you are at retirement age.”

“Currently trying to beef up the savings for maybe 3 months. The plan is eventually 5% match, and max Roth IRA contribution.”

“I graduated college about 10 years ago. I had a job by the time I graduated, but I never prioritized starting my 401k. I always thought let me pay off debt first. Or I don’t make enough just yet. Always had a reason not to, fast forward 10 years I thought well hell let me just open it with 50 bucks per check and I’ll slowly start increasing it. I guess my plan worked because within 2 months I’m close to maxing out the 5% match. I know early 30s is later than usual but shit better late than never”

“Hi all, I'm in the process of setting up a solo 401(k) and would appreciate some clarifications. For context, my business partner and I are looking to make roughly $600,000 for a S-corp in California. When trying to max out contributions for 2026 (only source of income), would it make more sense to opt for the deferrals as both employee and employer or choosing to make after-tax contributions for a mega backdoor roth conversion? If I have an existing roth ira account, are they any pro-rata r”

“I just started with cal trans out of college as a transportation engineer, and I have access to a 457b plan. My question is should I open a pre tax 457b and have a Roth IRA? Or is there a better combination I can use? Also what would be the best way to split my money up into the accounts. Thanks in advance for the help submitted by /u/TheBlackPearl805 [link] [comments]”

“In almost every case it's better to contribute to the 401k until it's maxed before you put it to a taxable brokerage. For purposes of retirement, you can get the money back out before the intended age via various methods. But like others said, don't kick yourself over what you did before, what matters is that you plan to max (or pretty close to) going forwards.”

“Dang it! I was automatically enrolled in the work 401k 4 years ago. I just never paid attention to it. I also have a Roth IRA that I max out annually, and a taxable brokerage account The past several years I always buy VOO in my Roth IRA, then another $13k or so into my brokerage via check to Schwab twice per year Just barely looked more into my 401k and regret not putting in more from the start. I changed it to 40 percent now which will put me at about $13k total for the year, nothing I can do”

“Hey everyone! I’m in my early 30s and recently started a new job that gives me the option to choose between a 401(a) and a state pension. I have to choose one, and once I make my decision, I cannot change it later. I will have access to a 457(b) plan regardless of which option I choose. I’ve never had a pension before, so I’m trying to figure out which option would be better for my situation. I’d really appreciate any advice or insight, especially from people who have experience with pensions. O”

“I'm a teacher and 11% of my salary automatically goes toward my pension every month. I also have a 403(b) but my contributions have remained relatively low. Started out at about 9% of my pay but since I haven't upped the contribution in a little while it's now at about 5%. But can't I think of that as contributing 16% to my retirement since I have both? I just became a homeowner so I'm unlikely to be upping the contribution this year. Just wondering if this is a good number o”

“I don’t get a 401k / match from my current job as I work for the state and they offer a pension. I make an ok salary given it’s a government position. Should I take the tax hit and convert? I don’t have a Roth, I just have an after tax brokerage account with minimal (8k) balance in it. I got married this year so hopefully the taxes I’d pay on it would be minimal submitted by /u/Mysterious-Brief-474 [link] [comments]”

“Can anyone lease explained like I’m 5 the benefits, differences, and the best option when contributing to my retirement (I think) funds? My work matches 6.2% and I currently contribute 12.4% into pre-tax. Should I consider after-tax, and Roth? Those are the other two options. Also, I contribute 4% into a Deferred Compensation Program. Should I put that into the 401k instead? I think that’s what it is. I’d love an explanation. PS. 26 y/o male public/city worker. TIA! submitted by /u/s”

“Hello, currently putting 12.4% of income into pre-tax contribution. Is this the 401k? Is this good? Is after-tax, or Roth contributions better? Idk the differences. I also put 4% to a deferred compensation program, should I remove that and put it all into the 401k? I also put $55 bi-weekly into my WeBull account. I’m 26, full-time public worker. TIA! submitted by /u/spicy-nacho-chicken [link] [comments]”

“It can be from either job, that's fine. It all goes into one pot, so the withholding can be from either job.”

“Hi all, I worked as a consultant prior to teaching and had a 401k with employer match. I also maxed out my Roth and HSA accounts. With teaching, 12% of pretax income goes to pension, and I still max out Roth and HSA. My question is - should I be taking advantage of 403b? Does anyone do this? There is like no information from my district. An option isn’t even on the website which makes me cautious. I don’t want to put my money anywhere that isn’t supported by the employer. I can’t count so much o”

“Your presentation is a little bit confusing. So I'll summarize your question: Am I subject to mandatory Roth for my catch-up contributions? Given your data, you're correct that you are not subject to Roth as a mandatory requirement for your catch-up contributions.”

“I (age 57) am starting a new job in a few weeks. Haven’t worked since December. I’m planning to max out my 403(b) this year by setting my contribution percentage as high as possible, then adjust downward next year to max out over a longer period of time. Am I correct that my catch-up won’t be a Roth since I had no income from this employer in 2025? And that it wont be next year either since I won’t have earned enough with my new employer this year to exceed the threshold? submitted by &#32”

“You realize that $14000 to a Roth IRA is very different to $14000 to a Traditional 401K? So you are not making a fair comparison. Since you are higher income overall and plan on retiring early, Traditional 401K is likely the better option.”

“We’re currently able to max out both our 401ks, both Roths and put $10,000 towards 529 for our 2 children. I’m probably going to get a decrease in income soon so I’m trying to figure out what to prioritize in regards to retirement. We have about $525,000+ in retirement ($438,000 401ks, $46,000 Roths, $40,000 brokerages). We are hoping to be able to retire in 15-17 years around late 50s so most likely before age 59 1/2. With this salary deduction one spouse can max out their 401k, the other spous”

“To preface, I have Robinhood Gold and utilize their Roth IRA for 3% match on contributions. I have about $31k pre-tax sitting in a former employer 401k with T Rowe Price. I want to do something with it. Options are: A) Rollover into Robinhood Traditional IRA with 2% promo B) Rollover into competitor Traditional IRA with possible promo (Fidelity or Schwab) C) Rollover into existing work 401k with current employer My main question is what would you do? Or does it not really matter so long as the m”

“I'm 26, single, make $60k/year, live in CA, and just started a mortgage on a home. The mortgage is a $180k loan at 5.625%. Aside from the mortgage, no debt. My current retirement plan is maxing out my Roth IRA at $7.5k/year. My employer also contributes 7% of my salary (~$4.2k/year) to my 403(b), but I currently don't make any personal contributions to the 403(b). After monthly expenses, which includes my Roth contribution, I have an extra $633/month left over. I already have a 6-month e”

“Annual roth ira contribution limits are $7500. my employer offers a 403b which I can allocate regular or roth (or a mix) and they do 5% contribution up to 5% match. given the annual limits on the 403b which I can’t possibly hit, is there any reason to not just do some split into the 403b only, as opposed to separately doing a roth ira? I’m contributing 10% currently (so effective 20% total) income is between 70-85k submitted by /u/dcnairb [link] [comments]”

“I started working for a new employer last year and they do not provide a 401k match. Currently I am contributing 6% with base salary of 145k. Would I be better off stopping contributions and putting that money elsewhere? I am already maxing a Roth IRA with VOO/VXUS submitted by /u/Simple_Method9674 [link] [comments]”

“I’m 28 years old and currently making around $75k a year gross. For the last two years I’ve maxed out my Roth IRA. My allocation there is 70% VTI and 30% VXUS. For my 401k, I’m currently contributing 5% as Roth and 1% pre tax. The 6% total gets me the full company match. I’m trying to figure out if it makes more sense at my income and age to keep my 401k contributions Roth or switch most or all of them to traditional pre tax. My thinking with Roth has always been that I’m still relatively young,”

“With the 30 year treasury at 5.15% and the TIAA lifetime joint annuity at around 7% (for me $1100/month treasury income versus $1700/month annuity income) does it still make sense at 70 to have the TIAA lifetime joint annuity or just rollover the money to your IRA and buy a 30 year treasury and leave the principal intact for inheritance? All thoughts appreciated! submitted by /u/IllustriousTennis230 [link] [comments]”

1099 lets you put more into 401(k).

“I’m not familiar with your 401k plan administrator, but Fidelity suggests a 15% contribution. The 15% includes contributions from both you and your employer. IMHO, if you can work on increasing your contributions now, that will compound much faster than awaiting a raise that “should” come in the next year. You are young, take full advantage of compounding. Next, what is the expense ratio of the funds offered? Consider low cost index funds, and only a minimal amount into an aggregate bond fund. I”

“As the title says, I’m a first-gen incoming big law associate. What’s the deal w a Roth IRA? I know you can make tax-free withdrawals when you retire. But how can I open one if our income prevents us from contributing? I have a traditional IRA from my previous job before law school. I never made any investments w the money at my previous job, so it’s been sitting in the account. Should I try to convert that account into a Roth IRA before I start? Should I just stick to a traditional IRA account?”

“After doing independent contracting work, I’m returning to a full‑time job. I assumed I could take advantage of the full $32,500 (+50 catch‑up) pre‑tax 401(k limit. My tax advisor warned me about the $150k wage rule that restricts catch‑up contributions to Roth only for high earners. The way I understand it, this rule applies only if your prior‑year W‑2 wages (2025) from that employer were above $150k . Is that correct? It’s based on the previous year, not the current year? Also, I’m assuming th”

“i make $20 an hour pre-tax as a barista with little to no expenses (i live at home with my parents). my work matches up to 5% and i currently contribute 15% to my roth 401k. would it be a good idea to maybe increase it to 20% to save a little more? my work gives me the option to either do pre or post tax and i’ve been doing post since i figured i’ll be paying more taxes when i get a better job; is this a bad idea? should i switch to doing pre tax contributions? submitted by /u/smores”

“I'm 25 and recently started a government job making ~$80k/year where we're given access to a 457b account. I can make both Roth and pre-tax contributions to the 457b. If I ever leave my job, I can withdraw money from the 457b without the 10% early withdrawal penalty. More specifically, pre-tax 457b contributions can be withdrawn without a penalty; I would just pay income tax on the withdrawal. With Roth 457b contributions, I can withdraw the amount I've contributed without taxes or p”

“I am in my early 40s and my employer offers a 6% match on 401k. I currently add 10% to my 401k. Would that extra 4% be better in a Roth or should I keep adding it to my 401k? submitted by /u/PandaBearJones [link] [comments]”

“i asked claude The formula Use a growing annuity sum: Total = C × [(1+g)^n − 1] ÷ g , then multiply by 0.03 C = first-year contribution, g = annual limit growth, n = years Base contributions (30 yrs, g = 6%) (1.06^30 − 1) ÷ 0.06 = 79.06 $7,500 × 79.06 = $592,950 contributed Match = $17,789”

Do the math without the match, then multiply by 3%. That’s the number

“At my workplace, I currently have: 1) Traditional 401K which has my pre-tax contributions from my paycheck 2) Roth 401K which has a mixture of: a. Roth contributions from my paycheck b. some adhoc conversions I made from my traditional 401K and paid taxes on c. after tax contributions from my paycheck which I automatically convert (mega back door roth) After I retire, I plan to rollover the Roth 401K to an existing Roth IRA that I have for over a decade. My understanding is: 1) The rolled over f”

“do roth now while it’s easy with your tax bracket , it’s a no brainer - when you make more it won’t be as easy. The more money you have without a partner (irs) is always the better , but most of us end up with a mix as salaries increase but Roth provides options down the road to manage taxes you will never regret tax free growth - no partners on that investment!”

“My 33 year old wife is leaving the workforce temporarily to stay home with our child. She is leaving with approx. 40k in her 401k (30k in Roth and 10k in a Traditional) . She and I both currently have Roth IRAs and a brokerage account with Schwab. My thought is rollover her Roth 401k to her Roth IRA and her Trad 401k to a rollover IRA and then convert that to her Roth IRA. Our AGI should keep us in the 12% tax bracket this year and next. I've estimated we will owe anywhere from $600 - $1200”

JG Wentworthy Homes!

“I earn $62,500 at the age of 31, with plans to increase my income as I gain more work experience in my management role and as I graduate with my college degree in the near future. I may only put in 3% into either plan at the moment with a 3% company match. My company uses Paychek Flex for our 401k plans. Which 401k plan should I prioritize? submitted by /u/SuchTax1991 [link] [comments]”

“Hi Everyone, I see the common practice is to invest in your company’s retirement plan up to the match. My company does not do a match, rather a lump sum deposit of a percentage of your salary once a year regardless if you invest into it or not . I currently have money going in every paycheck which funnels into Roth 401k account. Should I continue to have money go into this account even though there is no match or leave as is. Any advice would be greatly appreciated. Thank you! submitted by”

“Yes We plan to be in a lower tax bracket when we withdraw. Our income in retirement will be around 1/3 of current income Of course the tax brackets can change but anything can change.”

“My work provides pension plan with matching. We also have a DCP account that we can rollover to our roth IRA account so it’s not capped to yearly 7600. I’m currently putting money on both 403b and DCP (converted to roth). Should I prioritize one over the other? submitted by /u/bhudzallmighty [link] [comments]”

“I was contributing 15% to my 401k. My employer does a 50% match up to 6%. I recently bought a home and I am thinking of lowering my contribution from 15% to 6% until I save more in my emergency funds and then will eventually increase contribution again. Is this a reasonable plan? submitted by /u/acura_days [link] [comments]”

“I am going through an unfortunate divorce, which has more of less been amicable. One of the last things we are dealing with is splitting 401ks. My ex's trad 401k value is much higher than mine, so I am debating whether to take a cash transfer from existing accounts (to avoid taxes from cashing out a 401K) instead of a QRDO. It's been several years since we separated, so I would get my share of the 401K plus gains/losses. My ex is offering the historical growth rate of 10%, but it looks l”

“Is there any reason to keep roth 401k contributions in an employers retirement account, or would it be better just to roll those over into my roth IRA for greater flexibility? submitted by /u/jaydee288 [link] [comments]”

“I’m trying to think through my long-term 401(k) strategy and would appreciate a sanity check from you folks. Current situation - About $200k currently in a Traditional 401(k) - I plan to max out my 401(k) every year - Approximately 25 years until retirement - For modeling purposes, I’m assuming an 8% average annual return - I’m also assuming the IRS contribution limit will continue increasing over time roughly in line with historical increases - I’m ignoring employer match/catch-up contributions”

“Hopefully I can give enough info for you to be able to help me. So I work for the state I live in. I currently make $22.57 an hour with a decent amount of OT and consistent pay raises due to being in the union. I “technically” have 3 retirements. I have a “Hybrid Pension” which is a partial pension and a 401k where my company matches 2.5% of said 401k. I put a mandated 5% into my pension and 3.25% in my 401k with the employer 2.5% match. I also am enrolled in my company’s deferred compensation p”

“I'm 23 and started my current job mid-June of this year. They offer a 6% match on a 401k account and I was planning on just opening that account. I'll only be making around $33k/yr and I would like to also focus more on paying off $15k of student loan debt and the remaining $5400 for my car loan. My mom wants me to open a Roth IRA to select investments as well but I dont even know how she expects me to aggressively pay off my debt AND contribute to two savings accounts. She thinks that C”