Also you have to watch out for those expense ratios. I once worked at an employer where the only funds available in the 401k plan had expenses and fees around 2%. Managed mutual funds statistically perform no better than just cheap index funds. So paying those fees doesn’t actually earn you a higher rate of return. But plans with usurious fees are cheaper for employers to provide.
What was so egregious about it is that when I ran the numbers, I found that my employer’s 401k plan was actually worse than investing in cheap index funds in a regular taxable brokerage account. The 401k could be contributed to with pre-tax money, but all the tax benefits were cancelled out by being trapped in high expense 401k plans.
I contributed enough to get the match and invested any money above that elsewhere.
Have you looked into the high yield accounts from Marcus (Goldman Sachs). if you have any money Sitting around in a checking account or even Another savings account but you don’t need immediately you should consider this. The APY is 3.65%, which is a lot better than anything a regular bank will do. And you can transfer money between them with their app. of course they also offer no penalty CDs and standard CDs
Also you have to watch out for those expense ratios. I once worked at an employer where the only funds available in the 401k plan had expenses and fees around 2%. Managed mutual funds statistically perform no better than just cheap index funds. So paying those fees doesn’t actually earn you a higher rate of return. But plans with usurious fees are cheaper for employers to provide.
What was so egregious about it is that when I ran the numbers, I found that my employer’s 401k plan was actually worse than investing in cheap index funds in a regular taxable brokerage account. The 401k could be contributed to with pre-tax money, but all the tax benefits were cancelled out by being trapped in high expense 401k plans.
I contributed enough to get the match and invested any money above that elsewhere.
Have you looked into the high yield accounts from Marcus (Goldman Sachs). if you have any money Sitting around in a checking account or even Another savings account but you don’t need immediately you should consider this. The APY is 3.65%, which is a lot better than anything a regular bank will do. And you can transfer money between them with their app. of course they also offer no penalty CDs and standard CDs