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I would aggressively pay off debt, then max out 401K or nearly, then max out HSA, then Roth IRA.
Most financial planners suggest the same. So, if i was you I’d add more to 401K before opening a Roth. Reasoning is 401K is pretax so that’s an automatic 20%+ gain vs. a roth since any money you would invest into a roth is post tax.
Rising Star
They don’t A1... it’s always 401k up to company match then Roth IRA max then max the rest of your 401k in that exact order.
Would put more in if you could swing it. Also fidelity offers a Roth 401k plan (which might be better based on your current income)
Working to get there! Just a lot of cc debt (no financial backing so had to get everything myself and unfortunately credit was the way I went). As I pay off this debt, I am looking to start contributing to the roth going forward. If this stimulus passes then this process will speed up alot! 😂
Doesnt the firm match 25% of your contribution (up to 6%)? If you contribute 5% you would be missing a small portion of the match (1.5% - whtever 5% of 25% is)
first year here too - traditional advice ive read is 15% or as close to 15% as possible. Also, the more you invest now the more time it has to compound so my thinking is to contribute at 15% while building towards target emergency fund amount (6 mo expenses). After that, contribute more slightly more towards retirement while saving a little each month towards short term goals (vacation, new furniture, gifts, etc...) However, 15% is certainly difficult with student loan debt. Everyone’s situation is different
Rising Star
if you’re not getting company match, focus on your credit card debt first. When you get company match, then contribute what you need to capture that and focus the rest on credit card debt. When your credit card debt it gone, then add more to your 401k. Assuming your emergency fund is all built up. If not, then that first above all else.
Any plan that gets you closer to making out all tax advantaged options you have is a good one, no matter how long it takes. Everyone is different
Rising Star
Your employer match is so low... I would focus on paying off the credit cards then you can bump your 401k match up to 10-15% after that ideally.
So im doing 5% in my traditional 401k. You think I should switch the 5 pct to roth?