I'm maxing my 401k currently...
All I knew is I was putting 10% into a 401k, that did magical stuff later on in my life
Hi Zarakava,
Not sure if I'm reading this right, but just want to make sure you are clear on something that I see a lot of people misunderstand.
When you say you are 'maxing your 401k', but you are only putting in 10%, it sets off an alarm to me.
To 'max your 401k', you need to put $18,000 in it in 2017. That is the maximum that the government will allow you to save in that type of account each year. Unless you make about $180k, you will not 'max your 401k' on a 10% contribution from your paycheck.
Oftentimes when self-proclaimed 'newbie' types like yourself say that they are 'maxing their 401k' they mean that they are 'putting in the maximum amount that my employer will match'. Again,
this is not the same as maxing your 401k. In my case for example, my employer would only match 6% of my salary that I put in there. But to 'max my 401k', it would take around 25% of my income to reach the full $18k I am allowed to save in that account.
Hope this is stated clearly - if not let me know!
And if you
are making $180k or so, awesome! By all means, congrats, you are maxing your 401k!