So today I finally looked into what my best option was for either putting money into my company 401k or Roth IRA. I went and did some research on my companies HR site and found out that they are only matching up to 5% and not monthly but at the end of the year. I'm not sure they will match until later but dont want to miss out if they decide to this year. I am currently putting in 8%, so this knock-down drag out fight still looks to be a draw. I dropped my contributions back to 5% and hopefully the company will match at the end of the year. In the meantime I will put the extra 3% in with my monthly contributions to my Roth. At the end of the day I still think this is the best decision and hopefully this will get me closer to my 2009 goal of maxing out my Roth. I also have my fingers crossed that the economy will turn around and will get my 5% matched come years end.
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Typically advisors say to first match your payment into you 401k up to the company match (even if they only pay out yearly), second max out your Roth IRA for the year. For the most part people will agree with those first two steps what follows varies bit to bit. Third if you have money left max out the allowable contributions through the 401K. Lastly open your own person investin account.
ReplyDeleteThere are other things to invest in though...I haven't read everything here but you should save some money into a emergency fund (typically high interest savings or money market account) that you can get to easily and has rough 4 to 6 months of money that you can live on. Also, some people begin to look into real estate or other investments after the Roth.
Hope that wasn't too wordy, I will read more when I get the chance.