Submitted by [deleted] t3_z8n2v6 in personalfinance
jsalley t1_iycwcm8 wrote
"New Job: 200% on first 5%, 100% between 6% - 12%"
So if I am reading this right, if you contribute 12%, the new company will contribute 17%. Wow, that's an AMAZING 401k contribution.
At the ~$100k salary level, you can max out both 401k and Roth IRA. Very nice.
Alrik t1_iyd86yo wrote
You're right on the calculation for the match, but the employer match doesn't really impact your annual contribution limits.
For 2023, the employee themselves can contribute $22,500, and together with the employer's match/contribution, can put a total of $66,000 into their 401(k).
OathOfFeanor t1_iydffx9 wrote
I don't think they were saying the employer match helps with hitting the limit.
Just that at six figures of income, you should ideally be able to afford $22.5k into the 401k plus $6.5k into the IRA
That is a pretty high savings rate for most people, though. Possible but a stretch for many.
IratherNottell t1_iye69xs wrote
Holy cow, TIL I guess. I always thought contribution limits were inclusive of company match contributions.
Guess I need to read up!
[deleted] OP t1_iydgazg wrote
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Randomwoegeek t1_iyddzeo wrote
i'm wondering if some or all of that is on a vesting schedule
T_as_in_Pterodactyl t1_iydl9ni wrote
Yeah good point. This is a ridiculous match. My company doesn’t even match at all! I cannot believe where people find these companies haha
PatricksPub t1_iydw16y wrote
Seriously. The best I have seen is 100% match up to 6%. All of the job details that people post here seem ridiculous. I wonder if Reddit skews heavily towards tech or something like that. Because that's probably the 1 area I haven't looked due to qualifications that I don't have.
T_as_in_Pterodactyl t1_iydwv3m wrote
I’m currently in tech, 0% match. Best I’ve ever had was the classic 100% of the first 3%, 50% of the next 2. So 4% if you put in 5%. That was when I worked as an engineer in robotics. No idea where these people find these companies!
FilthySweet t1_iye1zd3 wrote
Im in tech. 50% match up to 7%. So not all of tech world making out like bandits. But a lot of really good benefits. I switched to software development/tech a few years ago with no experience, it’s doable. Just have to teach yourself a bit then start an entry position like jr dev or QA
ir0nuckles t1_iydxcte wrote
Tech got rid of 401k matches along with most of corporate America back in 2008.
ninjewz t1_iyesvsn wrote
I'm wondering where these jobs exist that I keep seeing, even in a technical field I can't find 401k matches that are worth a damn. My current match is 8.5% which was nearly impossible to find. All other job offers I've gotten have either been 3% or 4%.
tortillakingred t1_iyev7vw wrote
My company offers 100% match up to 7%, plus an extra 10% profit sharing into your 401k, so functionally 17% for free.
ir0nuckles t1_iydx7jv wrote
I've been working for 14 years and I've never had a 401k match. Not even 1%.
T_as_in_Pterodactyl t1_iydzqve wrote
This weirdly makes me feel better. Misery loves company I suppose? I’ve also been working around the same amount, entered the work force in 2008 and promptly had my first lay off in 2009. Lots of “once in a lifetime” recessions for us, eh?
[deleted] OP t1_iyelwzf wrote
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caustictoast t1_iydj6of wrote
To max both the 401k and IRA you’ll be saving almost 30% of the gross number. Unless you live somewhere very cheap you aren’t maxing both
Human_Person_583 t1_iydqucd wrote
You forget what sub you’re in.
Benjaphar t1_iydl89p wrote
Well not with that attitude.
ChoroidPlexers t1_iyduku7 wrote
I max both while making less....as a homeowner in Southern California....
flowcarve t1_iyenp9h wrote
That's inspiration! I would like to hear more about your budget. Trying to do the same but I'm nowhere close.
mspman6868 t1_iydt8tf wrote
Check out r/frugal they may change your mind
WorldOnFire83 t1_iyeg34o wrote
You are not factoring in that OP may have a spouse with income as well. That makes maxing retirement accounts much easier where it is a dual income home.
ir0nuckles t1_iydya46 wrote
It's pretty easy to max both actually if you have no debt.
[deleted] OP t1_iyeds16 wrote
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Wolf7Children t1_iyefw8y wrote
No it is 17%. Thinking about it in thousands, assuming 100k salary, let's assume he went for the max percentage that's match eligible, so 12%. So that's $12k. So for the first 5k (ie, 5%) they match it at 200%, meaning they put in double that, so 10k. So already his total is at 15k (5 him + 10 them).
Now for the rest, 12k - 5k = 7k. So that 7k (which is the 6-12% range), they match 100%, so 7k.
So in total, we have 12k from him, and 17k (10+7) from them. Or, 12% and 17%. So yeah, 17% is the maximum match he can get.
jsalley t1_iyehupb wrote
u/Paradox868, you keep saying (and emphasizing) "UP TO 5%". I see nowhere in OP where it says UP TO. Not once. OP SAYS: "New Job: 200% on first 5%, 100% between 6% - 12%" So if employee puts 12%: 1+1+1+1+1+1+1+1+1+1+1+1=12 The employer matches 200% (DOUBLES the first 5%), and then matches percentages 6-12: 2+2+2+2+2+1+1+1+1+1+1+1=17
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