According to the likes of Bob Jain, a 401k is perhaps the most worthwhile savings plan that you can implement. It helps you prepare for retirement so that you have ample money saved up when you no longer have to work. Retirement is one of the most common goals that people strive for, but you can get there quicker by getting the most out of your 401k as possible. To succeed in this endeavor, here are 4 pointers that should be remembered.
According to authorities on finance like Robert Jain, you should contribute more to your 401k with every pay raise you receive. While you don't have to contribute your entire raise to each month's savings, the truth is that a little more can go a long way. This is especially true if you remember that a 401k has to be built over the course of several years. Don't let your raises go to waste; invest them wisely in this plan.
Another way to get the most from your 401k is by consulting your employer to see if they can match your contribution. For example, if you invest about 5% of your biweekly pay into your retirement savings account, your employer may match it. What this means is that you get an additional bonus that you can use toward your 401k. Even if you're under the impression that your workplace won't allow this, it doesn't hurt to ask.
You should also resist dipping into the money in your 401k plan, as it can have many negative consequences. First, you will be penalized for taking money out, meaning that you'll have to make a payment on top of what you've withdrawn. Second, you will reduce progress made from a retirement saving standpoint. While it's understandable that someone may fall on hard financial times, taking money out of the 401k is an absolute last resort.
To wrap things up, and to help you truly maximize your 401k, review the plan in question at the end of each year. This will provide you with an opportunity to evaluate the progress you've made up until that point. It may also encourage you to make any financial changes that you see fit. If you feel like more money can be invested without hampering your day-to-day responsibilities, this should be considered. The more thorough your review is, the more you stand to gain from it.
According to authorities on finance like Robert Jain, you should contribute more to your 401k with every pay raise you receive. While you don't have to contribute your entire raise to each month's savings, the truth is that a little more can go a long way. This is especially true if you remember that a 401k has to be built over the course of several years. Don't let your raises go to waste; invest them wisely in this plan.
Another way to get the most from your 401k is by consulting your employer to see if they can match your contribution. For example, if you invest about 5% of your biweekly pay into your retirement savings account, your employer may match it. What this means is that you get an additional bonus that you can use toward your 401k. Even if you're under the impression that your workplace won't allow this, it doesn't hurt to ask.
You should also resist dipping into the money in your 401k plan, as it can have many negative consequences. First, you will be penalized for taking money out, meaning that you'll have to make a payment on top of what you've withdrawn. Second, you will reduce progress made from a retirement saving standpoint. While it's understandable that someone may fall on hard financial times, taking money out of the 401k is an absolute last resort.
To wrap things up, and to help you truly maximize your 401k, review the plan in question at the end of each year. This will provide you with an opportunity to evaluate the progress you've made up until that point. It may also encourage you to make any financial changes that you see fit. If you feel like more money can be invested without hampering your day-to-day responsibilities, this should be considered. The more thorough your review is, the more you stand to gain from it.
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Get in touch with Bob Jain if you would like additional information about what you have just read.
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