Originally Posted by
amcnd
401k is huge!! Seems so simple to say. Na. I will wait tell i get to a Major for retirement.. but the best years are your young years!! Simple 4% match on 45k in 35 years will easily grow to $79,000.. Best advice i got back in my early 20’s was to max out my 401k... So glad i listened to that advice..
Originally Posted by
Hedley
I did the same. I couldn’t afford to eat out or take even moderately priced vacations for a while, but I put 20% of my gross away every month. I also worked a part time job outside of aviation to be able to pay the bills because there wasn’t much left after I put that money into savings. I was taught that you’ll acquire more wealth if you start early rather than wait until savings is just discretionary income and it has paid off huge. I will be able to retire with no difference in my standard of living and be financially comfortable for the rest of my life.
Not everyone can afford to max out their 401(k) right off the bat, as the maximum contribution for 2021 is
$19,500, That's pretty much 1/2 of a new regional FO's salary. However, for those young folks out there that may be browsing this, it is excellent advice to start SOMETHING, ANYTHING toward your 401(k) (or other retirement like an IRA) At a minimum, you should contribute whatever gives you the maximum company match - it's free money (but know there is usually a vesting period to be able to keep it when you leave). Also, if you're healthy and are comfortable selecting a High Deductible Health Plan, you can also contribute to an HSA which can be invested to earn money (certain stipulations can apply, so be sure to read the fine print). You don't have to use it for current medical expenses and can also be saved for retirement, if desired.