My family is going to have to search for childcare again with the 5 day RTO our current arrangement doesn't work. The cheapest care I've found is $1k/month, and it's squeezing nearly every penny in our budget (my husband and I both work full time). I'm already only contributing about 3% to save money now, but thinking of pausing my $401k contributions altogether in order to create some more breathing room to account for unexpected expenses. I'm in my early 30s. Would this be a totally d-mb thing to do? Should I look into a second job instead? I'm trying not to stress.
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Wow, thanks all for your honest input I appreciate it. I'm the breadwinner of our family, so quitting to take care of my 1 year old isn't an option at the moment, though I wish it were. I'm contributing 3% because it's the max we can afford - with me covering our kids' health insurance, my husband is a state employee and required to contribute 9%, and we bought a house last year with a high interest rate. My eyes are crossed from looking at our budget, but I'm still finding ways to make it work. It fits where it is right now, but doesn't leave hardly any wiggle room. We have an emergency fund built up, but one emergency would probably clear it and I just don't like that feeling. I will keep on keepin' on and start casually looking externally and cross my fingers for a promotion this year. Thanks again for your advice!
Keep contributing the max that Dell will match. Take a 401k loan if things get tight.
“ Given the rate at which the government has fallen into the toilet, followed closely by the climate, you might be better off handling short term needs first.”
Are you the guy I saw still wearing a mask in his car by himself?
To the OP, you should putting 15% of your gross income into retirement.
Too many unknown variables for random Internet strangers to fill in the blanks.
A fresh look at the budget may be a good idea.
I would recommend start looking for a new job that pays more so that you can afford childcare. Getting a 2nd job is too hard when your kids are little. Also, look at some other daycare alternatives that may be cheaper and still quality. There are many small daycares that are a lot less. Saving early for retirement is important.
I’ve seen people try to do this in during my career. It’s too easy to not restart contributions. They’ll always be a good reason NOT to start saving again If you have to get a second job, that may be a way.
Try to save more than 3%
Given the rate at which the government has fallen into the toilet, followed closely by the climate, you might be better off handling short term needs first.
Pay yourself 1st. Contribute the at least the minimum to get your match.
Don’t do it. That money is also tax free, so it costs you even more if you turn off your 401k. Keep it and make sure to use HSA funds diligently as well.
hire an undocumented nanny
We faced a similar situation years ago and sat down and crunched tbe numbers. After the costs childcare for two kids my wife was working for about $3/hour. Made it a no brainer for her to quit and never look back. The first few months were hard, but with extra time to shop around for lower prices on the essentials and make homemade meals we were able to make it work.
Work on a budget, you will quickly see things that are must haves and nice to have.
Don't panic over this yet and make rash decisions. Talk to your boss and work something out. How the RTO is implemented and enforced is being kicked down to your leader level. Depending on who your boss is, this could be much ado about nothing.
don't do it.....
I am just about to retire. The best advice I ever got was from my late uncle who was a portfolio manager who oversaw billions of dollars in pension funds...
"If you want a decent retirement, save 10% of your career gross income. If you want a great retirement, save 15%. If you want to leave a legacy for your children, save 20%."
I'm 44 years into my career and I can tell you from experience this is 100% spot-on advice.
I understand everyone takes the path that makes the most sense for them. But I encourage you to seriously weigh if 3% more in your pocket today will make much difference? Are there other ways you can scrimp to maintain that retirement savings level?
Hello from a 62-year old who is happy he never once cut back on making 401k contributions, even in the darkest days when we too struggled with the insane costs of childcare, healthcare, housing etc. earlier in our lives.
Sure, you can pocket that 3% and have a bit more cushion, and sleep (marginally??) better today. But every $ you invest today will be worth $3-5 when you're my age due to compound growth. The earlier you invest a dollar, the longer it has to grow.
While you struggle to balance your family budget today, take a peek at how large a nest egg you'll need to produce the necessary income for your retirement. Apply the 4% rule, and you'll quickly realize you're going to need a pretty large pile. Every dollar counts.
Best of luck to you and your family, as you navigate these challenging times.
Do whatever the match is and then try and find other ways to save! You’d be giving Dell a discount if you don’t make them contribute.
Buy Bitcoin on a regular basis with what you can afford and never look at the price - you’ll thank me in 20 years. Wishing you well on your childcare search.
Yes very d-mb
Also, you’re only contributing 3%? Dude, you need to max it out, especially at your age.
I’ll just answer your question in the title:
Yes it’s absolutely absurd to do that because it gives little to no incentives for an employee to even contribute to the company. You’re basically throwing your money at a wall and hoping it grows like some inert bank account.
They could have just had executives cut their pay temporarily but nope. Their poor leadership impacts you and you only. F**k your retirement, their salary is more important to cash flow.
Now get back to work, you goober. That sort of free thinking is dangerous to the less intelligent and more privileged.
Do whatcha gotta do for now - but long term make changes (probably means getting out of Dell)
Nope. Sometimes you do what you have to do. You have time to make up once things settle down
if saving that 3% will make you sleep better at night.
you can always resume contrib next year. missing 1 year is no biggie
if not already, rebalance your 401k to more aggresive stocks to help defray lack of contribs