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Thread: Keep on adding to 401k?
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05-10-2010, 12:18 PM #1Registered User
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Keep on adding to 401k?
I am in a situation where I may lose my job by the end of the year, as I have stated in a previous thread. It's not going to be a layoff, it's going to be termination, if it happens. I do not want to get into details, but I was recently suspended and I am fighting it with our union, but things are not looking good. I feel like I have a target on my head with this employer.
Regardless of what happens, I want to get out of there. I do not want to work for this employer anymore after this recent incident. I am, however, contributing to 401k which has a 50% match up to 3%. However, I am only vested at 40%, 60% in November (anniversary of hire).
I do not see myself at this employer for another year, I have been sending out resumes like crazy and I have been following all leads. I am hitting this pretty hard. I'm even starting to donate plasma twice a week ($260/month) and do Arbitron ratings ($30/month) for extra cash.
I have figured it out, we can survive on my wife's salary alone. HOWEVER, we will not be making any progress on debt or savings. It will be a break even game.
My question is, should I just scrap the 401k and go nuts on the debt? Or should I take what I can get from it and keep going as is?
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"It doesn't matter how hard you hit, it's how hard you can get hit and keep moving forward. That's how winning is done." - Rocky Balboa
Story of my life. In 2007 we had 78000 worth of debt, and we climbed out under it, on top of paying for a surgery with cash, bought a house, had a foundation shift and $11000 in repairs later we are good to go.. then I hear the words "I'm pregnant!"
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05-10-2010, 12:27 PM #2Rude and Vile Master
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Define "scrap" please?
Originally Posted by Preston
Do you mean halt contributions? Or do you mean cash it out?If you could kick in the pants the person responsible for your problems, you wouldn't be able to sit for a month.
Did you know that a 4 year student paying $20,000/year who finances their education graduates with over $103,000 in debt to start? But a student who works and pays cash and takes 6 years to graduate ends with $6,300 in their pocket! So much for "getting a head start by financing!"
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05-10-2010, 12:35 PM #3Registered User
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halt contributions. I am not going to pay a penalty to withdraw my money.
--
"It doesn't matter how hard you hit, it's how hard you can get hit and keep moving forward. That's how winning is done." - Rocky Balboa
Story of my life. In 2007 we had 78000 worth of debt, and we climbed out under it, on top of paying for a surgery with cash, bought a house, had a foundation shift and $11000 in repairs later we are good to go.. then I hear the words "I'm pregnant!"
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05-10-2010, 12:35 PM #4Super Moderator
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You say you can survive on her income. So, if you can do that now, you will be even better off if you have less debt, true? I say pay down debt.
Russ
Truck payments:109876 5 4 3 2 1 WAHOO!
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05-10-2010, 12:52 PM #5Rude and Vile Master
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If you're certain about the single income situation, I agree with Russ. Halt the contributions and get that debt reduced!
If you could kick in the pants the person responsible for your problems, you wouldn't be able to sit for a month.
Did you know that a 4 year student paying $20,000/year who finances their education graduates with over $103,000 in debt to start? But a student who works and pays cash and takes 6 years to graduate ends with $6,300 in their pocket! So much for "getting a head start by financing!"
Greebo(Nerd Spender): Loving and extremely patiently tolerated husband of ceashels.
WARNING: Y Chromosome behind the keyboard. Adjust your listening filters appropriately!
ThreeTwo mortgages,twooneno car loans,oneno credit cards, and a partridge in pear tree!
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05-10-2010, 01:02 PM #6Registered User
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I agree with 'the men'. When I was talking to my ex-fil (who is also a financial planner) about raising the Old Man's 401K contributions, he said "You have to be free today to save for tomorrow".
Pay... pay... pay! When you get a new job, you can go back to saving.
I can't be out of money... I still have checks left!
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05-10-2010, 01:32 PM #7Registered User
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I would tend to drop the 401K contributions also, assuming it's not a large dollar amount. For example, my employer matches $.25 on the dollar for the first 4% - but for my salary that's $9.23 per week. If I only got 40% of that due to vesting, that $3.69 per week - totally not worth it. If you'd get a much bigger chunk of change after factoring in the 40% vesting, I'd stay in, but I'd make my decision on the dollar amount.
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05-11-2010, 11:31 PM #8Registered User
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It was averaging around $10 a paycheck they were matching.
I dropped the withholding down to 0.
Cut my wife's contributions to hers in half.
We're going into emergency mode now.
Worst case scenario is that we are ready should our income cut out.
Best case scenario we're out of debt.
--
"It doesn't matter how hard you hit, it's how hard you can get hit and keep moving forward. That's how winning is done." - Rocky Balboa
Story of my life. In 2007 we had 78000 worth of debt, and we climbed out under it, on top of paying for a surgery with cash, bought a house, had a foundation shift and $11000 in repairs later we are good to go.. then I hear the words "I'm pregnant!"
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