401(k) is a strategy designed by your employer towards your
retirement investments. It enables the employees to save and devote part of
their earnings before taxes are paid out. Smart
ways to boost your 401(K) will include the following;
It is very
uneconomical to remove your savings from the 401(K) before you get to your retirement.
Withdrawing your money before attaining the age of 59 plus will require you to
pay all your earnings’ taxes and more so a heavy 10% fine. This will definitely
leave you with a lost goal.
Agree to your employer’s choice of investment scheme. If the
employer chooses a saving plan that doesn’t suit you or that you don’t like,
agree to it as rejecting it will render you out of the tax benefit scheme.
Agree to leave your money in the 401(K) even after
retirement. If your employer has no problem with you not withdrawing from the
account after your retirement, let the money hang about intact until you reach
the age of about 70. Then you can
withdraw and this will help more in attaining you cutback goal.
Ensure you put in as much as possible to gain the matching
contribution. If you cannot have enough to get a full cup of savings,
contribute as much as possible as this will help you achieve a rewarding
matching contribution, what is simply known as free money. Basically, a common
match lies between 50 cents of a dollar to 6% of your income. So for this 6%
match of $50,000 the matching contribution will be $3,000.
Furthermore, invest into as many venture as possible to
ensure you have a varied saving. Investing only in the 401(K) will not be good
enough to have a smooth life after retirement. Many varied savings will help
you gain the desired goal much easily.
Open new account after you shift to a new job. Transferring
to another job may leave you at a dilemma. However, consider how much is in
your current 401(K), if too little, your current employer may require you to
pull out all your stash. But that should not be a problem opening a new 401(k)
account would be the best option. Avoid
withdrawing the savings as this would lead to more loss.