When to join 401K plan

[disneysteve]

My wife is just starting a new job that has a very good 401K plan. What I'm wondering, though, is if it makes sense to contribute from day 1 or wait at least a little while to see if the job is working out okay. It is something totally new for her and for all we know, she may not care for it once she is actually doing it. She will only be working on a per diem basis so there won't be a great deal of money involved. I'm just thinking that it might be more hassle than it is worth to contribute for a month or two and then have to transfer the money if she leaves the position. On the other hand, I hate to give up the 50% match if she ends up staying (needs to be there 2 years to be vested in the match).

What would you all do? Contribute from day 1 and hope for the best or give it a month or so.

[Ima saver]

Contribute from day 1 and HOPE!

[jIM_Ohio]

go in from day 1, because you could roll the money over if she leaves

[Coleroo]

Always plan for the best. 50% match is something you wouldn't wanna miss on account of a "whoops, we thought..." scenario. I would suggest always contributing from day one. Some companies may even have a limited enrollment period for new hires, and you may end up waiting a long time to catch the next period ('tis what happened to my husband).

But DO check with the company's plan details - some companies do an automatic distribution of funds at termination if the employee's account is under a certain amount, and that could cause problems if you didn't see it coming.

[disneysteve]

Some companies may even have a limited enrollment period for new hires, and you may end up waiting a long time to catch the next period ('tis what happened to my husband).

some companies do an automatic distribution of funds at termination if the employee's account is under a certain amount,

Good point about the enrollment.

If she were to leave and get a distribution, I'd just roll it over, so that wouldn't be an issue. If they withold taxes, I have the cash to make up the difference to roll over the full amount.

Thanks folks. This is one of those questions that I knew the right answer to but was kind of wavering on. Thanks for reinforcing what I already knew was the right way to go.

[Fern]

Do it now. It's not that big a deal if you have to roll over to an IRA later if she leaves the job.

[MonkeyMama]

I agree with do it now. It isn't that much hassle and I Was going to say than her income would not have to be taxed - income tax anyway. Which is why I would certainly start from day 1.

[TBH]

Nice to know even an experienced saver like disneysteve still needs a little help staying on the path!

[George23]

Contribute right away. Remember - your contribution vests immediately - it is only the employers matching portion that may have a vesting schedule.