401K catch-up
Don
it's something they can do. And if so, does it provide a win win
situation for both the employee and the employer.
I am 56 years old, but I haven't qualified to participate in the over
50 catch-up program that allows those over 50 to contribute an
additional amount to a 401K account as long as you have reached the
federal maximum limit for that year. I contribute the maximum my
employer allows (15%) and at that percentage of my salary, I don't
reach the federal max. limit.
One solution was to get a huge raise from my employer which ain't
gonna happen. The other is to ask my employer to raise their 15% max
limit to a higher percentage so I can both contribute more and also
take part in the catch-up program if that increase results in my
contribution reaching the fed max.
The problem with that is that my employer matches our contribution
with a 15% match. I didn't want to burden them with having to pay
employees more via their match because they raise our contribution
percentage limit. So my proposition to my employer was for them to
continue matching 15% of our contribution, but only up to an amount
that equals 15% of our salary at most. That way, if they were to
allow us to contribute up to, say, 30% of our salary, they would only
have to contribute a 15% match of half of that, keeping them at the
same rate of match as before.
Are there any restrictions preventing them from doing this? Can this
be a benefit to the employer as well as the employee?
Thanks,
Don
Laurence Sheldon
"Don" <dsa...@yahoo.com> wrote in message
news:47334fb2...@news.west.cox.net...
> I made the following suggestion to my employer and I'm wondering if
> it's something they can do. And if so, does it provide a win win
> situation for both the employee and the employer.
>
> I am 56 years old, but I haven't qualified to participate in the over
> 50 catch-up program that allows those over 50 to contribute an
> additional amount to a 401K account as long as you have reached the
> federal maximum limit for that year. I contribute the maximum my
> employer allows (15%) and at that percentage of my salary, I don't
> reach the federal max. limit.
>
> One solution was to get a huge raise from my employer which ain't
> gonna happen. The other is to ask my employer to raise their 15% max
> limit to a higher percentage so I can both contribute more and also
Don't waste your time Don, you would be better off putting your 401K to
work for you effectively, MOST people don't know how to manage their
401K, my brother too for example, he doesn't know shit about which stocks
they put him on, the fund managers also don't know shit. It's not their
moneys.
My brother lost 25% on his 401K right now and he doesn't know it, I
opened his 401K statement. So you can see, asking for 15% increase in
contribution won't help you.