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401(k) Magic in the Air! Maxing out YOUR 401(k) Plan!

When it comes to mapping out your future, planning to live a comfortable life when you are unable to work anymore or just want to retire and fulfill your bucket list may be something that is on your mind. When you are hired, your employer is likely to offer you a 401(k) plan where you can elect to defer a portion of your salary and contribute it to a tax-deferred retirement account.

Most companies offer this and it is a great way to build up your financial cushion for life after your career. There are other employers, such as universities, that offer a similar plan called a 403(b). There will be some employers who match a portion of employee contributions to both of these plans. Check with your company to see if this is an option for you. If so, you can structure your plan to receive the maximum employer matching contribution. If this is available, you should structure your contributions to receive the maximum employer matching contribution.

A very important thing to remember when planning to save for retirement is to know how much you believe you'll need by the time you retire. That way, when you are putting in funds per paycheck, all the math will add up to your ultimate savings goal. There may be a lot of time between now and retirement and therefore, there's a good chance that other variables will act as forks in the road for your wallet, so planning for such occurrences will benefit you in the long run.


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