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Increased My 401(k) Contributions

This article was written by in Saving. 6 comments.

Since my side income seems to be growing more than I expected this year, I’ve decided to increase my 401(k) contributions to reduce taxable income. In February, I increased my income deferral rate from 4% — the minimum contribution necessary to maximize the company’s match rate — to 6%. I was already maxing out my $4,000 yearly contribution to my Roth IRA, so adding more to the 401(k) made sense. At some point, I increased the rate again to 8%.

Today, I doubled my contribution rate to 16%. I will try to keep it at this rate for the rest of the year.

$55 of my savings each paycheck goes to a savings account at ING Direct earmarked for “relocation.” This will hopefully provide me with enough cash for a down payment on a house at some point, but it’s only at $1,755 right now.

Updated June 16, 2011 and originally published August 25, 2006. If you enjoyed this article, subscribe to the RSS feed or receive daily emails. Follow @ConsumerismComm on Twitter and visit our Facebook page for more updates.

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About the author

Luke Landes is the founder of Consumerism Commentary. He has been blogging and writing for the internet since 1995 and has been building online communities since 1991. Find out more about Luke Landes and follow him on Twitter. View all articles by .

{ 3 comments… read them below or add one }

avatar ib

i had just this week increased my 401k contributions too! from $135/wk to 150/wk (we are paid weekly. my co does not match) and i max out my roth each yr. i supply ing acct as able (at least 100-200 or more per mo).

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avatar Dus10

I only put 5% into my 401(k), but my employer matches it with 4% that is fully vested on day one. Then, they have a profit sharing plan that is 8%, and there is an annual contribution of 2%, both of which will be fully vested in about a year.

I put $45/pay (semi-monthly pay, so $90/month) in HSBC, as well as some extra money from eBay and mystery shopping.

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avatar nes

My company matches 6%. I am currently contributing 16%. I’ve been doing this consistently for the past 5 years. My goal is to get it up to 30% (max) if I can find a cushion or other streams of income.

750 – 1000 a month go into an ING DIRECT acct monthly.

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