The only person in the company mad about bonus structure

[chicagomeg]

My husband has been waiting for final word of his bonus for last year. We've never had a situation where he gets a bonus before, but his understanding was that it would be paid as an employer contribution to the 401k, with a 5 year vesting schedule per his normal employer contributions. Today, he found out it's actually being paid as $6,000 in cash, no vesting. I think we're the only ones disappointed; we're already maxing out the 401k & Roth for the year so I guess now this will go towards our house down payment fund. It's fine (of course!), but I would have rather just thrown it in the 401k!

[MrCash]

That's disappointing.  I had the option of putting my bonus straight into the 401k, but instead I took it out as cash.  I did this because I'm saving up for my house, but it was painful to watch the taxes chop it up.

[Cheddar Stacker]

Based on the fact that it still needed to vest (at least I think that's what you are saying) I'd say it's better to have the cash. A lot can happen in 5 years that could prevent him from vesting in the 401K bonus. What's the saying, "a bird in the hand is worth two in the bush"?

I get what you're saying, I'd love a bonus in my 401K, but I'd think twice if I had to wait 5 years to make sure I actually earned it through vesting. Good problem to have though, so congrats!

[the fixer]

I got a $1000 bonus at an employer last year that just distributed it according to our direct deposit and deductions setup. Well, I had set mine up to direct $729 per pay period to my 401(k) to max it out for the year. I was quite surprised (pleasantly) when I realized that nearly all the money went into my 401(k) with a nice 4% match!