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NeedaVacation03
03-17-2008, 07:23 AM
There are a lot of people on here with good advice, so I am going to ask a 401K question. My DH is 52yrs old, and we are putting $$ into 401K. Due to poor past financial choices we are behind on retirement. I am wondering at this point if the 401k is the best choice due to his age and the economy. Anyone have any suggestions? Let me know if I need to give more info.

littleteapot
03-17-2008, 07:43 AM
This is the order I've heard that works best for more people. YMMV

Fund 401K up to max company match (for us this is dollar for dollar up to 4% of salary)

Fund Roth IRA accounts for both of you, you can put in up to $5,000 each (if you're over 50) for 2007 (before April 15, 2008) and $6,000 each for 2008 (before April 15, 2009).

If you have any money left to invest, fully fund the 401K

Golf4food
03-17-2008, 09:33 AM
This is the order I've heard that works best for more peole. YMMV

Fund 401K up to max company match (for us this is dollar for dollar up to 4% of salary)

Fund Roth IRA accounts for both of you, you can put in up to $5,000 each (if you're over 50) for 2007 (before April 15, 2008) and $6,000 each for 2008 (before April 15, 2009).

If you have any money left to invest, fully fund the 401K

The above is generally the best advice. For my company the match is 5%, but rather than dollar for dollar it is a profit sharing so this past year we received $1.42 per dollar - even better! (We get at least $0.50 per dollar in bad years.)

Be sure to check what investment options you have in the 401K itself and make use of them - don't just leave the money in company stock, for example. As a for instance, my 401K has the following fund options to choose from: bond, stable value, S&P 500, Russell 2000, International, Balanced, and Company stock. We also have a financial recommendation engine that can recommend how to diversify your 401K based on age and targeting retirement income, etc. - check to see if something similar is available to you.