Author Topic: Maxed 401k and IRA for the first time!  (Read 2040 times)

JLee

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Maxed 401k and IRA for the first time!
« on: December 31, 2015, 09:32:24 AM »
I discovered MMM in late 2014. If I recall correctly, I was contributing around $3500/year to my 401k (6%..maxing employer match, but not more).

Fast forward to the last day of 2015. In the last year, I opened and fully funded a Traditional IRA and ramped up my 401k contributions throughout the year (first 10%, then a bit more, then eventually to the most my employer would allow - 40% - which would still have fallen short of 18k by the end of the year). However, I knew the right people at the right time and was offered a new job in late September, which allowed me to max my 401k - so on today's paycheck, I've hit the IRS limit for the first time. :D

I also cut my phone bill almost in half (it's now less than half of what my employer compensates for my phone), cut my AZ home's summer electrical use by almost half ($397 -> $214 summer peak), and decluttered/donated a massive amount of stuff. I'm now in NJ (due to the aforementioned job) and I have a friend moving into my master suite in two weeks (on top of the other two rooms which are already rented) - and he's taking over all the utilities for my house, so it'll basically sit there and pay for itself and wait for me to move back to AZ one of these years. Add in well over $1k in credit card rewards, and it's been a great year! Here's to an awesome 2016! :)

dandarc

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Re: Maxed 401k and IRA for the first time!
« Reply #1 on: December 31, 2015, 09:36:45 AM »
Well done!

ambimammular

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Re: Maxed 401k and IRA for the first time!
« Reply #2 on: January 07, 2016, 01:33:59 PM »
Nicely done!

This was our first year maxing DH's 403b and the Roths, so I get you.
Now I just need to follow your lead and do the decluttering.

RWD

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Re: Maxed 401k and IRA for the first time!
« Reply #3 on: January 07, 2016, 02:39:41 PM »
Congrats!

My story is similar. Found MMM in mid-2014 and was contributing the minimum for employer match. Once I learned about things like the Roth conversion ladder I increased my percentage. For 2015 my contributions were going to be about $20 short of the 401k federal limit (I just picked the closest percentage) but my employer automatically increased my final paycheck's contribution such that I hit $18k exactly.

So for 2015 we maxed my 401k and both our Roth IRAs. My wife's new job has both a 403b and 457 available, which means we have $65k of annual tax-sheltered space (plus HSAs, if we go that route). I'd love to max all of that in 2016, but we'll see. Still a lot of unknowns for the year.

Cookie78

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Re: Maxed 401k and IRA for the first time!
« Reply #4 on: January 07, 2016, 03:16:22 PM »
Yay! Congrats!

JLee

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Re: Maxed 401k and IRA for the first time!
« Reply #5 on: January 07, 2016, 03:25:17 PM »
Congrats!

My story is similar. Found MMM in mid-2014 and was contributing the minimum for employer match. Once I learned about things like the Roth conversion ladder I increased my percentage. For 2015 my contributions were going to be about $20 short of the 401k federal limit (I just picked the closest percentage) but my employer automatically increased my final paycheck's contribution such that I hit $18k exactly.

So for 2015 we maxed my 401k and both our Roth IRAs. My wife's new job has both a 403b and 457 available, which means we have $65k of annual tax-sheltered space (plus HSAs, if we go that route). I'd love to max all of that in 2016, but we'll see. Still a lot of unknowns for the year.
Oh man, that's an incredible amount of room!  I would definitely do your HSAs, even before other stuff - remember it is pre-FICA, so you're saving another ~7%.