On track to Max out $73k+ of pretax

[themagicman]

I just made a change today with my payroll department to put us on track to max out all $73k of our pretax deductible retirement space. We should have everything maxed out by the beginning of December. We didn't think we would be able to use all of our tax advantaged space this year (Still paying on house) but it looks like we will be able to!

Also, by doing this we will now be qualified for the "2nd level" of the savers tax credit, so that means an extra $400 from that!!

[I'm a red panda]

Impressive! 
What percent of your income is this?  I'm sure you have super low spending to be able to do it, but it sounds like you must have pretty damn high income too!

[themagicman]

Impressive! 
What percent of your income is this?  I'm sure you have super low spending to be able to do it, but it sounds like you must have pretty damn high income too!

Thanks! The pretax portion is about 70% of our income. Total savings about 79%. After taxes (what little we pay) we make $104k on the year. We will spend $22k and save $82k ($73k of this being pretax)

[I'm a red panda]

Impressive! 
What percent of your income is this?  I'm sure you have super low spending to be able to do it, but it sounds like you must have pretty damn high income too!

Thanks! The pretax portion is about 70% of our income. Total savings about 79%. After taxes (what little we pay) we make $104k on the year. We will spend $22k and save $82k ($73k of this being pretax)

Those are really impressive numbers there.

[Patrick A]

I just made a change today with my payroll department to put us on track to max out all $73k of our pretax deductible retirement space. We should have everything maxed out by the beginning of December. We didn't think we would be able to use all of our tax advantaged space this year (Still paying on house) but it looks like we will be able to!

Also, by doing this we will now be qualified for the "2nd level" of the savers tax credit, so that means an extra $400 from that!!

As far as I understand, the normal employee contribution to 401k retirement plans maxes out at $18,000 - - - but I know the employer can put significantly more in. 

Did you make a deal with your employer to pay you less and divert it to their contribution to your retirement account?  I really should look into this, I'm sure my HR would be flummoxed but it might be a brilliant move to avoid paying unnecessary taxes on take home you don't need. 

[themagicman]

I just made a change today with my payroll department to put us on track to max out all $73k of our pretax deductible retirement space. We should have everything maxed out by the beginning of December. We didn't think we would be able to use all of our tax advantaged space this year (Still paying on house) but it looks like we will be able to!

Also, by doing this we will now be qualified for the "2nd level" of the savers tax credit, so that means an extra $400 from that!!

As far as I understand, the normal employee contribution to 401k retirement plans maxes out at $18,000 - - - but I know the employer can put significantly more in. 

Did you make a deal with your employer to pay you less and divert it to their contribution to your retirement account?  I really should look into this, I'm sure my HR would be flummoxed but it might be a brilliant move to avoid paying unnecessary taxes on take home you don't need.

No, we did not make any special deal, but do have a lot more tax advantaged space than most people. Also, the $73k does not include employer contributions which would add an extra ~$5k. Our tax advantaged space is broken down below

Me                          My Wife
401k $18k               403B $18k
IRA $5,500              457  $18k
                              TRS $2,000
                              IRA $5,500
Both HSA $6,500

Total $73,500
                         

[Patrick A]

ahhh, I see. 

You do have more tax advantaged space than the average bear.

Only way I could get more than the 2x18,000 + 2x5,500 + FSA would be to tell my employer to "cut" my salary and instead direct it to an increased 401k match.  Not sure about any of the legalities surrounding that though.

[Mississippi Mudstache]

Only way I could get more than the 2x18,000 + 2x5,500 + FSA would be to tell my employer to "cut" my salary and instead direct it to an increased 401k match.  Not sure about any of the legalities surrounding that though.

I don't think that's allowed. Employer matching rates are set company-wide, they can't give you a special increase without running afoul of the rules.

By the way: Great job, magicman. You're killing it!

[Patrick A]

Only way I could get more than the 2x18,000 + 2x5,500 + FSA would be to tell my employer to "cut" my salary and instead direct it to an increased 401k match.  Not sure about any of the legalities surrounding that though.

I don't think that's allowed. Employer matching rates are set company-wide, they can't give you a special increase without running afoul of the rules.

By the way: Great job, magicman. You're killing it!

Thanks, helpful. 

And agreed -- You are killing it!

[Tjat]

No, we did not make any special deal, but do have a lot more tax advantaged space than most people. Also, the $73k does not include employer contributions which would add an extra ~$5k. Our tax advantaged space is broken down below

Me                          My Wife
401k $18k               403B $18k
IRA $5,500              457  $18k
                              TRS $2,000
                              IRA $5,500
Both HSA $6,500

Total $73,500
                         

We have this same opportunity excluding the TRS and HSA so once my wife heads back to work, this will be my goal. Awesome work sir

[Sean Og]

No, we did not make any special deal, but do have a lot more tax advantaged space than most people. Also, the $73k does not include employer contributions which would add an extra ~$5k. Our tax advantaged space is broken down below

Me                          My Wife
401k $18k               403B $18k
IRA $5,500              457  $18k
                              TRS $2,000
                              IRA $5,500
Both HSA $6,500

Total $73,500
                         

We have this same opportunity excluding the TRS and HSA so once my wife heads back to work, this will be my goal. Awesome work sir

Likewise, this is exactly our current strategy (minus HSA & TRS-->KPERS) now that my wife has begun her teaching job (wont max all this year though). Helps get our AGI down for PSLF on her 60k  student loans.