Ep. 25 - Are you funding your 401k the right way?
Episode 25 Are you funding your 401k the right way?
Often times people will think they are maxing out their 401(k) when they are really just putting in the amount needed to get your company match. Other times people will put in the full IRS maximum ($22,500 in 2023) but they are not getting a match after a certain amount, so that additional contribution - while good - may not be as efficient as contributing to an IRA or Roth IRA once you have hit the most your company will match.
In other words if you plan on contributing $15,000 to retirement accounts but your company only matches the first $6,000 it likely makes sense to contribute the next $6,000 of your money to an IRA or Roth IRA so you have more control over your investments. Then you can go back and put the last $3,000 into your company plan again.
Disclaimer - Information provided in this podcast is not tax, legal or investment advice. Every person's circumstances are different. If you would like to discuss your personal circumstances, feel free to reach out to Red Barn Financial.