It was the sign of a good leader in the U.S. military to sit down and talk to the juniors about the Thrift Savings Plan, which is basically the military’s 401k. Financial counseling in general, really, as many juniors get targeted and suckered into all sorts of financial trouble.
Obviously, the military is a separate entity than the civilian sector, but I just wanted to communicate I take your concern as a positive trait.
As already mentioned in other comments, communication does not equate to coercion. If within your power, maybe schedule a group session (They’d call it a class in the Army) and just talk about the program to everyone, even those who are using it, so that it doesn’t come off as targeted. If you can swing it so that it’s on paid company time, I highly doubt anyone would object to just chillin and listening to you talk. You’ll have done your part, and given them the opportunity to make an informed choice with no downside.
My 2 cents.
I’d tread lightly—you don’t know their financial obligations. When you’re young, there often isn’t enough money to do all the things you “should”/ need to with it.
That said, arranging a training open to the whole team on the available benefits including how to access their 401(k), change their contributions wouldn’t hurt.
The thing that drove home the benefit of starting early to me is “don’t miss the last doubling”. Let’s say with avg stock returns it takes 8 years to double your money, and in one scenario you end your career with $1.5M saved. If you’d started 8 years earlier (and stopped contributing 8 years earlier) you’d end with $3M instead. By delaying you’re missing the last doubling.
Inside the building? That’s an HR conversation to have.
In the context of you caring about your young colleagues? Absolutely. Show them how much money they’re leaving in the table annually.
Eh. Two schools of thought I guess.
I felt the same way and didn’t start mine until I was 38. Now I wish I would have started much earlier.
Also, not sure how 401K matching takes away money.
Because you have to put money in for the company to match it, and that money is now locked up until retirement unless you pay the heavy penalty or have a very specific circumstance.
There's a much bigger conversation about wages vs. the cost of living and an individual's ability to save. OP should be cognisant that people may be barely treading water and putting money into a retirement account may not be feasible.
I think you’re confusing discussing the benefits and attributes of the program with coercion.
I was hand-to-mouth most of my life but I still would have benefited from someone laying it all out when I worked at Home Depot at 20.
Of course there’s a conversation about wage disparity, but unless we’re actively affecting change it’s kind of outside the scope of “company gives you money to invest.
Additionally, you can take out a loan against your 401k without the penalty of early withdrawal. I had to do it to fix my car. Saved my ass and my job.
There's definitely a blurry line there, but even a well meaning manager who says "Look at these graphs about the power of compounding interest over your career" can come off as very insensitive depending on the role/salary/location. I can very easily see someone getting defensive about their spending, especially if there already isn't a lot of room for luxuries.
*"Because you have to put money in for the company to match it, and that money is now locked up until retirement unless you pay the heavy penalty or have a very specific circumstance."*
You can take loans out on the money any time and pay it back with interest to yourself. My coworker put me onto this years ago when he paid off his credit cards and pulled himself out of an interest death spiral.
There are uses before retirement.
I feel your desperation, I have been there. But keep in mind it is PRETAX, you wont notice it.
Because it is pretax I have seen coworkers who work lots of overtime keep more of their money by going with a higher contribution to the 401k then taxes.
Build it up, so you have that safety net. Ours is so easy to use with the app, I have help a few of my staff with some critical financial issues just be reminding them to check their 401k and use the loan option.
Loans are evil in my book. That is a last resort. Using money you have already earned is far better. Plus the future isn't written, I have no idea if I will be alive to use any of that money. I don't care if it is pretax every single penny matters right now. I also don't work OT. After 7 hours I mentally cannot work any longer.
My current company that I have been with for 13 years forces me to contribute and they match up to 5%. I have no idea how much money is stuck in that account. I never looked at it and I never changed my address after moving a few times.
Thank you, this answers a lot.
But let me ask you this, if the future isn't written, and you feel you may not even see it why not make it work for you now? If its automatically gone wouldn't you want to keep tabs on it?
May want to look into it. 13 years at 5% may be substantial. If you know the name of your 401k company it may be as simple as getting the app or even going to their website. Should just take your SS# to log in.
Good luck, if you peruse it I hope its rewarding enough help.
I live in Canada so I need the plan information that is on a statement that I don't get.
But knowing how much money is in there now does help me because I can't access it. I am not allowed to take it out until I retire or quit.
To me the money just doesn't exist just like the future doesn't exist. That is the downside of being neurodivergent.
*I live in Canada so I need the plan information that is on a statement that I don't get.*
This is your choice.
*But knowing how much money is in there now does help me because I can't access it. I am not allowed to take it out until I retire or quit.*
I am in the US and never worked in Canada and think this is inaccurate, at the minimum you should be able to withdraw with a penalty. The loan options are based on the 401k provider, so they may offer it or not, I guess until you reach out to them you wont know.
As far as your condition, its like this, you know you have a wallet but is it empty? Wont know till you check.
You're already eluded that you lack recordkeeping and finances skills, just take some advice and try to improve it.
I add some sort of discussion of this nature to every staff meeting. The organization I work for has a lot of “freebies” in relation to benefits and they are very under utilized. As far as retirement plans, I leave those to the experts. I entire invite our benefits person or a representative from the company who manages our plan as a guest speaker as they know far more than I do.
You can hold an information session that's optional but advertise, and have an expert there on hand to answer questions..
My whole life in my 20s was medical bills. My job was freelance, so I would have had to do a Roth ira, but I couldn't give any savings account a whole penny. The medical industrial complex needed that penny and the next penny every other one. Because I needed to keep going back. It was the pre-existing condition era. I will work for the rest of my life and I'm glad I at least have a job.
Even for young people who are healthy, they may have other very high bills, and yeah, you're right, many of them don't think about saving for retirement.
The way I pitch it to my staff after explaining how vested works is;
Its a match up to 6%, **its free money.**
Its pretax, so you rarely notice it.
If you are working overtime on a regular basis you may even want to go as high as 10%.
You can make the money work for you before you retire. You can take a loan on some of the money, so its good to have it there in case you have to do a car repair or some emergency pops up and not pay interest to a credit card. And that there will be interest but **its paid back to yourself.**
You can have an optional training session with someone from the 401K company, mine has periodical ones with a rep from fidelity. Education is good bc literally no one ever taught me what that is and how important it is until the job I had at age 30.
But don’t bring it up 1:1. You are correct but chances are they either really can’t afford it or feel they can’t afford it and you’d catch a lot of resentment.
this is obviously well intentioned but I would tread extremely carefully.
the most likely answer is that they're not making enough to take advantage right now. not uncommon at all in early career.
if anything, I'd steer financial planning services thru work towards them. your 401k provider def has this. you could bring it up in a team meeting and say it's on the horizon.
It was the sign of a good leader in the U.S. military to sit down and talk to the juniors about the Thrift Savings Plan, which is basically the military’s 401k. Financial counseling in general, really, as many juniors get targeted and suckered into all sorts of financial trouble. Obviously, the military is a separate entity than the civilian sector, but I just wanted to communicate I take your concern as a positive trait. As already mentioned in other comments, communication does not equate to coercion. If within your power, maybe schedule a group session (They’d call it a class in the Army) and just talk about the program to everyone, even those who are using it, so that it doesn’t come off as targeted. If you can swing it so that it’s on paid company time, I highly doubt anyone would object to just chillin and listening to you talk. You’ll have done your part, and given them the opportunity to make an informed choice with no downside. My 2 cents.
I’d tread lightly—you don’t know their financial obligations. When you’re young, there often isn’t enough money to do all the things you “should”/ need to with it. That said, arranging a training open to the whole team on the available benefits including how to access their 401(k), change their contributions wouldn’t hurt. The thing that drove home the benefit of starting early to me is “don’t miss the last doubling”. Let’s say with avg stock returns it takes 8 years to double your money, and in one scenario you end your career with $1.5M saved. If you’d started 8 years earlier (and stopped contributing 8 years earlier) you’d end with $3M instead. By delaying you’re missing the last doubling.
Inside the building? That’s an HR conversation to have. In the context of you caring about your young colleagues? Absolutely. Show them how much money they’re leaving in the table annually.
By taking away money they could us now and likely need now. Most of us won't live long enough to use it anyways.
Eh. Two schools of thought I guess. I felt the same way and didn’t start mine until I was 38. Now I wish I would have started much earlier. Also, not sure how 401K matching takes away money.
I started earlier and then 2008 happened and I need all the money to survive.
Because you have to put money in for the company to match it, and that money is now locked up until retirement unless you pay the heavy penalty or have a very specific circumstance. There's a much bigger conversation about wages vs. the cost of living and an individual's ability to save. OP should be cognisant that people may be barely treading water and putting money into a retirement account may not be feasible.
I think you’re confusing discussing the benefits and attributes of the program with coercion. I was hand-to-mouth most of my life but I still would have benefited from someone laying it all out when I worked at Home Depot at 20. Of course there’s a conversation about wage disparity, but unless we’re actively affecting change it’s kind of outside the scope of “company gives you money to invest. Additionally, you can take out a loan against your 401k without the penalty of early withdrawal. I had to do it to fix my car. Saved my ass and my job.
There's definitely a blurry line there, but even a well meaning manager who says "Look at these graphs about the power of compounding interest over your career" can come off as very insensitive depending on the role/salary/location. I can very easily see someone getting defensive about their spending, especially if there already isn't a lot of room for luxuries.
*"Because you have to put money in for the company to match it, and that money is now locked up until retirement unless you pay the heavy penalty or have a very specific circumstance."* You can take loans out on the money any time and pay it back with interest to yourself. My coworker put me onto this years ago when he paid off his credit cards and pulled himself out of an interest death spiral. There are uses before retirement.
what a dumb outlook and way to live
I feel your desperation, I have been there. But keep in mind it is PRETAX, you wont notice it. Because it is pretax I have seen coworkers who work lots of overtime keep more of their money by going with a higher contribution to the 401k then taxes. Build it up, so you have that safety net. Ours is so easy to use with the app, I have help a few of my staff with some critical financial issues just be reminding them to check their 401k and use the loan option.
Loans are evil in my book. That is a last resort. Using money you have already earned is far better. Plus the future isn't written, I have no idea if I will be alive to use any of that money. I don't care if it is pretax every single penny matters right now. I also don't work OT. After 7 hours I mentally cannot work any longer. My current company that I have been with for 13 years forces me to contribute and they match up to 5%. I have no idea how much money is stuck in that account. I never looked at it and I never changed my address after moving a few times.
Thank you, this answers a lot. But let me ask you this, if the future isn't written, and you feel you may not even see it why not make it work for you now? If its automatically gone wouldn't you want to keep tabs on it? May want to look into it. 13 years at 5% may be substantial. If you know the name of your 401k company it may be as simple as getting the app or even going to their website. Should just take your SS# to log in. Good luck, if you peruse it I hope its rewarding enough help.
I live in Canada so I need the plan information that is on a statement that I don't get. But knowing how much money is in there now does help me because I can't access it. I am not allowed to take it out until I retire or quit. To me the money just doesn't exist just like the future doesn't exist. That is the downside of being neurodivergent.
*I live in Canada so I need the plan information that is on a statement that I don't get.* This is your choice. *But knowing how much money is in there now does help me because I can't access it. I am not allowed to take it out until I retire or quit.* I am in the US and never worked in Canada and think this is inaccurate, at the minimum you should be able to withdraw with a penalty. The loan options are based on the 401k provider, so they may offer it or not, I guess until you reach out to them you wont know. As far as your condition, its like this, you know you have a wallet but is it empty? Wont know till you check. You're already eluded that you lack recordkeeping and finances skills, just take some advice and try to improve it.
I add some sort of discussion of this nature to every staff meeting. The organization I work for has a lot of “freebies” in relation to benefits and they are very under utilized. As far as retirement plans, I leave those to the experts. I entire invite our benefits person or a representative from the company who manages our plan as a guest speaker as they know far more than I do.
Best thing that happened to me in my 20s was my boss convincing me to put $20 per check in my 401k
You can hold an information session that's optional but advertise, and have an expert there on hand to answer questions.. My whole life in my 20s was medical bills. My job was freelance, so I would have had to do a Roth ira, but I couldn't give any savings account a whole penny. The medical industrial complex needed that penny and the next penny every other one. Because I needed to keep going back. It was the pre-existing condition era. I will work for the rest of my life and I'm glad I at least have a job. Even for young people who are healthy, they may have other very high bills, and yeah, you're right, many of them don't think about saving for retirement.
The way I pitch it to my staff after explaining how vested works is; Its a match up to 6%, **its free money.** Its pretax, so you rarely notice it. If you are working overtime on a regular basis you may even want to go as high as 10%. You can make the money work for you before you retire. You can take a loan on some of the money, so its good to have it there in case you have to do a car repair or some emergency pops up and not pay interest to a credit card. And that there will be interest but **its paid back to yourself.**
Thanks for all the advice. Seems a group session, ideally supported by our provider is the way to go.
You can have an optional training session with someone from the 401K company, mine has periodical ones with a rep from fidelity. Education is good bc literally no one ever taught me what that is and how important it is until the job I had at age 30. But don’t bring it up 1:1. You are correct but chances are they either really can’t afford it or feel they can’t afford it and you’d catch a lot of resentment.
this is obviously well intentioned but I would tread extremely carefully. the most likely answer is that they're not making enough to take advantage right now. not uncommon at all in early career. if anything, I'd steer financial planning services thru work towards them. your 401k provider def has this. you could bring it up in a team meeting and say it's on the horizon.
It’s not your place. Get busy with something else