1. says

    I was promoted last year. I instantly increased my 401K contribution to 20% from 12% to start investing more. I also liked your advice about investing in Roth IRA vs traditional IRA.

    • says

      Nice job! You basically accomplished what it took me several years to get to. But as I always say – if you can afford it, then do it! You’ll only get to reap the rewards of compound interest sooner than later.

  2. says

    The whole story seem too convoluted to me, thanks to info such as this post and I am able learn about keywords and then research it further, so thank you for that. I already checked what’s the story with IRA with my friends who’s in the know about it. All that I have read your blog. Useful info and I like the passion you put in.

    • says

      Thank you very much for your feedback. This blog is intended to provide financial advice to people of all levels – beginner to advanced. If my story seems convoluted, then that tells me I am not doing a good enough job of simplifying these matters. I really do want to make sure that people feel empowered to make educated decisions about their personal finance.

  3. says

    Last year was the first (and only, for a while…) year that I maxed out the 401K and the Roth IRA. I am going back to school this year, but as soon as I find a full-time job, I am going to max out my accounts!

    • says

      Good job getting there at least once! … And good job going back to school! I’m sure that when you return back to full-time work you will likely continue the good saving habit you have already started.

  4. m doats says

    I always wonder when I see these posts – are you talking about the full amount allowed by the IRS (ie 44,000/year) ? That seems like an excessive amount to put in retirement savings for most people. Only 17% of US households make 100k or more per year, and even if you are in that fortunate group this is 20-40% of your total income. How do you balance your retirement savings against other goals, given that there are substantial penalties for 401k withdrawals.

    • MMD says

      That’s a good question, and a lesson that I try to stress in many of my posts. My wife and I decided a long time ago that having enough money to retire (possibly early) was extremely important. We started off with just the simple 10% like everyone else. But over the years, every time we’d get a raise, we’d split it and raise our retirement contribution. When we’d get a profit sharing check or income tax refund, rather than wasting the whole thing, we’d put it in our IRA. When we’d finish making car payments or daycare payments, we’d continue to “pay” that money into our IRA’s. Yes, over many years we have built that number up to $44K (2 x $17K + 2 x $5K). I guess it always came down to what’s REALLY more important – putting the money towards a mature cause or blowing it on something frivolous? The fundamental to all of this is that we’ve always kept our lifestyles modest. Although we’re living much more extravagant lifestyles than we did when we first got married or started our jobs, we still live within a budget that is way below our means.

      Read my post on using a 72T to take out your retirement money early without penalty before age 59-1/2. If we are ever lucky enough to need to, this will be one of those tax loopholes that we take advantage of.


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