Today, I had Dad change his retirement account withholding. We checked the box that says “take out the legally allowed max”. We’ll be contributing about 16% vs the 10% we do now, which translates to approximately $250-$300 “less” per paycheck (bi-weekly). We were already contributing so high because that was the minimum to get his company’s match (8.33%!), so we figured we’d delay debt-repayment for one month to just go ahead and max it out this year.
Dad works for a non-profit, so instead of a 401(k), he has both a 401(a) and a 403(b). For all intents and purposes, the two together are the same as a 401(k) as far as the employee is concerned – except they’re two separate accounts at Fidelity. We’ll be contributing $17,500 of our own money this year, and an estimated $8,500 of his company’s match for a whopping $26,000. He wont be 100% vested until he’s there for another 2 years though.
I upped mine to 6% for this month, and once the student loans are paid off, I’ll up it 2-3% a month until we either get to the max or get uncomfortably squeezed on cash flow. After student loan repayment, we’ll have an estimated $2300/mth to play with, so even if I maxed out my contributions, we should still be fine on cash flow.
I’m very excited to see the light at the end of the debt repayment tunnel and be able to really start saving that money.
That’s awesome! I maxed mine out in 2013 and it felt great!
The best part is seeing the light at the end of the debt repayment tunnel! With the considerable amount we’re throwing at our debt, that should hopefully compound significantly as savings!
Hooray for maxing out! I think the tax benefits alone will make this seem like a fantastic move in the long run. And with more money to compound, you’re making your future selves much happier and wealthier. Good on ya!
We’re only maxing out the one account at the moment, and the other will have the maximum equivalent percentage taken out, but only for 5 months, so not a full max out (this year!)
Wow $26,000! That’s fantastic. Congrats on maxing out your 401 accounts. That’s always a great feeling. Will you do it again in 2014?
That’s only Dad’s account (he has an awesome match program at his workplace). 2014 will be the first year that we max out one of the 401(k)/403(b) accounts. Hopefully, 2015 will bring about maxing *both* out. Thanks for stopping by!