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Up Your 401K and Adjust W4 Exempts

2011 Money Quickies

I wanted to call-out a couple quick things to consider going into 2011.  They are easy tweaks to make that can have significant impact on your savings for the future as well as your immediate take home pay.

  1. Now is the time to make the most of your employer’s match to your retirement account.  If you employer matches your contribution I would urge you to make the choice of maxxing your contribution so that the employer is helping double your maxxed savings for the year.  If you really want to make a choice in 2011 that will make a bigger difference when you are ready to retire, now is the time to adjust.  It may mean less take home pay but you are going to spend less in 2011 anyway, right?
     
  2. With the new year you should consider reviewing your W4 form.  That’s the form that allows you to claim exemptions on your payroll taxes.  The more you claim the less taxes are withheld on your pay checks.  If you are getting an abnormally large refund check from Uncle Sam each year, I think you should probably up the exemptions so that you are getting more of your money up front.  Thus, allowing you to put those dollars to good use such as paying down credit card debt or monthly bills.  On the other end of the spectrum is if you are having to pay Uncle Sam each year in April, I suggest lowering your exemptions so that you are not getting yourself into that financial position.  Either way you can go to the IRS website and play with the W4 calculator and see what they suggest.

I hope these simple suggestions help you in your journey to living life richly!  Every little bit helps and we all need all of the help we can get!  Please share a comment if you have any tweaks you’d like to suggest to the readers as well!

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