401K match removed?

[cypher1]

Just curious if anyone's employer has removed company match. If so, are you changing anything? My roommate just lost his, and worried about his position so will probably lower his contribution rate soon.

My work does 6% match (I contribute another 18%), and I expect them to remove the match soon. Raises and bonuses are out this year (to be expected), and I'm predicting re-orgs/layoffs within the next quarter or two, if not sooner. My EF is good for a year, but I'm also debating if I should eventually lower my rate as well. I'm starting to pile up more cash for tuition as I have at least another year. If I lost my job, I'd just pay out of pocket with tuition reimbursement gone from employer.

[disneysteve]

I haven't heard of any yet. And our bonus is contractually spelled out so they're kind of bound to that. We shall see.

[Fishindude77]

As a former employer, this would be one of the very last things I would cut because it benefited me and built my retirement account as well.
If you shut off the employee 401k match, the business owner can't keep getting his / hers.

Further ... A 401k is still a pretty decent deal without a match as you get to save, invest, and build your money without yet getting taxed.

[cypher1]

A 401k is still a pretty decent deal without a match as you get to save, invest, and build your money without yet getting taxed.

Agreed. But I could understand others lowering their contribution rate if they're more concerned about potential job loss. Therefore focusing more on short term cash savings than long term. That is, if they don't have an adequate EF built up.

[kork13]

A 401k is still a pretty decent deal without a match as you get to save, invest, and build your money without yet getting taxed.

Agreed. But I could understand others lowering their contribution rate if they're more concerned about potential job loss. Therefore focusing more on short term cash savings than long term. That is, if they don't have an adequate EF built up.

Agree... I've never had a match, so not a concern for me. But if you don't have an EF and are anticipating a layoff, the 401k contribution is an easy way to free up a bit more cash.

[LivingAlmostLarge]

401k downgrade doesn't free up more cash that much. I mean 6% of $100k is $6k and of $60k it's $3600. But it's $3600 pretax. So you will lose a bit to taxes. $3600 at 85% is $3060 over the year. I guess it takes care of one bill. Rather than lowering my 401k, i'd be cancelling every subscription service netflix $15/month, hulu, cable, cheaper cell phone plan, maybe even paying off that new iphone so monthly payment. Or returning the leased car. I mean $3060/year is $250/month and you can get that from cancelling all your subscriptions. Stop paying for instacart, eating out, delivery of groceries. Maybe don't pay for amazon prime. Raise my deductible on my car and home insurance.

Truth of the matter that your roommate should see how much is rent. Are they renting the cheapest possible place? Do they have spotify? Netflix? Disney+?

[cypher1]

Just got the email of our employer removing the company match starting next month till at least the end of the fiscal year. Still gonna leave the current contributions where they're at.

[disneysteve]

I have a friend who works for Rush Medical in Chicago. Their 403b match was frozen.

[LivingAlmostLarge]

why did they remove it so quickly? Didn't the cut in salary and bonuses cover the costs without cutting more?

[bjl584]

My 401K match is still intact.

Our raises and bonuses are frozen however,
We should have received them the first pay day in May, but they are on hold until further notice.

[cypher1]

why did they remove it so quickly? Didn't the cut in salary and bonuses cover the costs without cutting more?

We got our annual bonuses end of March, which were pretty nice. But I knew we wouldn't be getting anything for a long time going forward. Raises are no longer a thing, as to be expected. Otherwise no other salary cuts. But a lot could still change in the next coming months.

[cypher1]

A coworker suggested putting whole check this month (last pay period 5/29) in our contribution, to get the last max match (6%) on the whole check. Does that make sense? I don't have to worry about hitting 19500 limit being under 6months in, and never thought about that option for taking the whole check this one time.

[corn18]

A coworker suggested putting whole check this month (last pay period 5/29) in our contribution, to get the last max match (6%) on the whole check. Does that make sense? I don't have to worry about hitting 19500 limit being under 6months in, and never thought about that option for taking the whole check this one time.

That doesn't make sense. The amount of the match is based on a % of your pay. If you make $1000 this pay period, they will match up to $60. If you put in $50, they will match $50. If you put in $1000, they will match $60. So putting in more than 6% of your pay will not increase your match.

[disneysteve]

A coworker suggested putting whole check this month

My job limits our contribution to 50% of income. When my wife worked here, I wanted to contribute 100% of her salary and they wouldn't let us.

[cypher1]

That doesn't make sense. The amount of the match is based on a % of your pay. If you make $1000 this pay period, they will match up to $60. If you put in $50, they will match $50. If you put in $1000, they will match $60. So putting in more than 6% of your pay will not increase your match.

Agreed. I believe my friend thinks if he temporarily changes contribution to 100% for that pay period, employer will match dollar to dollar for that window, instead of the 6% limit.