My husband went permanent

[dehoyos4]

After 2 + years my husband has finally gone permanent!!! So I am CFO (chief financial officer) in our family and don't know much about 401k plans, so hopefully I can get some advice.

They are willing to contribute 100% for up to 6% of pay contributed to 401k. We will contribute the 6% (hello, free money). Should we go for high risk or low risk, should we contribute more than 6%, and should we buy the 15% off company stock price and invest in that too?

My husband is 26 and will be making 68k a year.

Thanks.

[Broken Arrow]

First of all, welcome and congrats on your executive promotion!

Yes, definitely put in at least 6% to capture the full employer match.

I'm guess the two of you are a young couple, so I'd lean towards an aggressive asset allocation.

Also, if I am reading correctly that you are getting a 15% discount off of the company stock price, then I would do what I can to buy that as well. However, depending on how safe and how confident you are of the company, I would only set anywhere between 0% to 5% of your entire portfolio towards holding the company stock. The rest, and depending on the buy program, I would look to sell and reinvest that according to your planned asset allocation.

What I am prescribing above is the general rule of thumb. If necessary, please feel free to take that and modify it to what is most suitable for the both of you.

Take care.

[dehoyos4]

The company is HP and I feel pretty confident but not sure if this is the right time to buy?

[Broken Arrow]

Wow, HP, that's great!

Tech stocks, in general, are highly volatile. Don't know how you feel about that. Were it up to me, I would hold very little, if none at all.... This is especially if you are someone who don't wish to keep up with individual stocks to begin with.

Because of the 15% discount, I would still buy as much as I can... and depending on the details of the stock purchase program, sell as much as I can to reinvest back into the retirement fund according to your asset allocation.