The Employer Match

[thyme4change]

I jumped from employer to employer when I was starting my career, so I never counted on the match until it vested.  That became a habit.  I just realized that although I have included my vested balance in my planning, as I do my calculations I have only included my future withholdings and have not included any future employer match.  It is the most conservative thing to do - because I might have to start a new job tomorrow, and may never vest again.  But between my current plan, and my husband's longevity at his job, even if we get just the next three years for each of us it will bring another $75 grand 20 years from now.  If we are able to keep a job that vests and brings us about the same percentage as we have now - we could be up in the $300k - $350k range.  Not too shabby.

Right now about 10% of my balance in my current 401k is employee match - same for my husband.  I rolled over my previous 401k, and I know some of that was matched dollars, but have no idea how much.  About 60% of our retirement funds are in our current plans.  Those pennies add up!

How much of your retirement is from your input and growth on that vs. employee match?  

[Apple]

I get a match of 5% as long as I put in at least 5% (automatic 1%, full match of my own contributions up to 3%, 1/2% at 4 and 5%).  I've been at 15% for most of the last 14 years (I did drop to 7% for a while), so I've made that 5% since I started working here.  I don't count it when doing calculations either, but it's a huge bump to my total invested.  Pretty much 25%+ of the money put into my retirement came from matching.

[msventoux]

No match currently, and I've been at my employer for quite some time.  Previous employers, the most matching I got was 3%. 

[lynnerself]

Looking at my account, it looks like 20% is from employer contributions (match and profit sharing ).
I never think about it when I budget how much I am saving though. But it is another $5000 or so a year.

[ohhkay2]

Employer Contribution: 43.2% (of total)
Not Vested: 23.9% (of total)

I'm currently contributing 11% to my employers 10% and have 16 months before my 3 year vesting period is up.

[Deleted]

My 401K is about 30% of my retirement and 25% of it (16K) is employee contributions and earnings.  I had rolled over a 401K from the same place twelve years ago, assuming it was also about 25% employer at the time, then another 23K there. 

Grand total about 16% of all my retirement money is from employer contributions.

[Cookies Galore]

No employer contributions to my 403b, but I have an employer-funded pension. That's actually more valuable than my 403b right now.

[alinal]

I work for a small, generous company. I don't know exactly how much of my total retirement was contributed by them, but it's >50% (quick calculation gives me 55% including growth).

Originally, we didn't have a 401k, just SEP IRAs that they contributed to.  Which was fine when I was younger and didn't know so much about retirement savings.  Now, thank goodness, we have a 401k that we're allowed to contribute to.  There is no match, but they aim for 10% of our salary each year, and have met that every year I've been employed.

It is all immediately vested.

[kjto1]

I am encountering that not all companies are offering a match.  Something to plan for (or not plan on) in the future.

[Deleted]

Oct 19, 2014 9:18:58 GMT -5 kjto1 said:

I am encountering that not all companies are offering a match.  Something to plan for (or not plan on) in the future.

That's really crappy.  Many employers presented 401(ks) as a "replacement" for the defined benefit pension plans they were terminating.  They aren't, really, since the risks of outliving savings are now dumped on the individual employees.  One company I worked for was a class act; those of us who started after they got rid of the pension plan got 6% even if we didn't participate in the 401(k) AND got a 100% match on the first 6% we contributed.  They truly were attempting to pass on all the $$ they saved in terminating the pension plan to the employees.  What I see more often is employers who may have contributed 10% of payroll to a pension plan replacing it with a 401(k) with a 3% match (which, of course, they cut back when things get bad).

Anyway, in answer to the OP's question:  my IRAs are a mix of rollovers from 38 years of employment so I can't really trace the amounts back to employer/employee funds.  I've been fortunate.  From 1985-1995 I was in a company that I think matched 3%.  Vesting was partial over 5 years but when I left I was totally vested.  For 6 years after that I was in small consulting firms; one didn't match, the other matched based on profit and I don't think I got very much.  Beginning in 2002 I was with companies that matched up to 6% with immediate vesting, including 6 years with the firm that put in 6% on top of that.  So, in my case, employer contribution was certainly a big benefit. 

[TheHaitian]

That is a good question:

- I don't calculate my employer match because it all in the form of employee stocks, same for the cash balance pension.
- I update their value every year when I get the statements but I do not include them in "future calculations" since the future is unknown.

But if I were to trust their last statement, at 65 I should be getting $205k from the profit sharing plan and 310k from the retirement plan. Not too shabby, 500k that I did not have to invest or save myself.


- As for my wife she lost out on 3k for following me before vesting from her previous employer. Current employer put ~5% into an ORP plan for her. We don't include it into future calculations but do update the balance/contributions every 2 weeks. She is also required to contribute ~10% into that ORP account.

I just check the account, 31% of the balance is from employer contributions. Not too shabby.

She also contributes into a 403b but get no match in that one.

[gooddecisions]

I have contributed approximately $140,000 and my employer has contributed approximately $60,000 in 12 years. No guarantees for tomorrow, so I rarely go through the forecasting exercises. But, if I were interviewing at another company, I would consider those benefits to compare total compensation.

[Lizard Queen]

For most of my working life, I've contributed 15%. I briefly cut it down to 10%, and it was as high as 18% for a while too. Throughout that time, I've gotten a 50% match on the first 6%, so 3% in actuality, and also 100% match on 4%. There was also about a year in which the match was cut out completely. So, without actually looking up my numbers, I would venture a guess about 18% of the total 401k is from employers.  A pension would have been much more significant, I think.

[midjd]

I factor in my employer's contributions (~3.5%) but not the pension, which should be worth substantially more. I don't vest in it for another 5.5 years, and the earliest I'd be able to start collecting is 2039.

In the overall scheme of things, I contribute about 30% of my pay to retirement (including HSA, etc.), so the 3% match doesn't make a huge difference.

[thyme4change]

I haven't factored in my husband's potential pension.  I can't get a straight answer about how it works, and he isn't trying very hard.  He told me yesterday that shortly he will be vested in it, which will bring about $12k per year starting in 2037.  If he stays at his job, it will increase - I think that is the minimum payout or something.  I thought the number was funny because when I look at my very crude calculations, it looks like we are short about $25-$30k per year in future dollars.  But, our house will be paid off, plus that $12k, puts us at "found" money of $28k.  

[Ryan]

My match is very generous...there is a guaranteed portion and then a discretionary portion and part of it is vested immediately and another part after you've been there 4 years or something.  I'm on track to maxing my 401k this year and the match will be an additional 30% on top of that.

I also have the benefit of my wife's state pension as a teacher, which is 70% of the average of the highest 3 years salary.

And then we have our business, which is in my wife's name.  So we can max out the 401k and then do 25% of her salary through profit sharing.

[LlamaLlamaDuck]

ER matches 4%, as long as you're doing (trying to remember) 7.5% or better.  I've been at my current job for over seven years and I believe full vesting was at 4 years.  Right now I'm doing 11%, 15% with the match.

ETA That doesn't count the HSA, just the 401K.

[The Walk of the Penguin Mich]

My employer match was 2x mine.  So if I contributed 5%, they contributed up to 10%.  

So while I contributed 100% of my IRAs (which amount to about 25% of my retirement holdings now), my employer contributed 2/3 to my 403b.  I was vested from the beginning.

[TheHaitian]

Oct 19, 2014 14:26:51 GMT -5 The Walk of the Penguin Mich said:

My employer match was 2x mine.  So if I contributed 5%, they contributed up to 10%.  

So while I contributed 100% of my IRAs (which amount to about 25% of my retirement holdings now), my employer contributed 2/3 to my 403b.  I was vested from the beginning.

Your employer is awesome!!!!

[LlamaLlamaDuck]

My employer match was 2x mine. So if I contributed 5%, they contributed up to 10%

That's really nice. Are they hiring?

[Deleted]

Oct 19, 2014 10:19:15 GMT -5 CCL said:

You are probably correct about a pension value being more significant $$$ but who wants to stay at the same lousy job for 30+ years? They can take the pension away whenever they please and then you are screwed.

What's sadder is that the job can go away. I have 2 pensions: one started at age.60 and is $950/month, from a GE sub. It was sold in 2006 so I no longer accrued any benefits after that even though I stayed with the successor company another 6 years . The second, for $1k/month starting at 65, is from a company that downsized me.after 10 years. Staying 30 years in one place was never an option!

[The Walk of the Penguin Mich]

Oct 19, 2014 14:29:29 GMT -5 TheHaitian said:

Oct 19, 2014 14:26:51 GMT -5 The Walk of the Penguin Mich said:

My employer match was 2x mine.  So if I contributed 5%, they contributed up to 10%.  

So while I contributed 100% of my IRAs (which amount to about 25% of my retirement holdings now), my employer contributed 2/3 to my 403b.  I was vested from the beginning.

Your employer is awesome!!!!

Not only that, they continue to contribute during my disability that 10%.  I can't contribute to it, so have been diverting those funds to an IRA instead.

[sapphire12]

My employer has contributed about 25% of my account balance. I'm fully vested, so the balance is all mine when I leave.

[econstudent]

No match. I do have a defined benefit pension though. I think I'd rather have a match for my 457b because 1) I feel like it would give me more flexibility and 2) I'd like to put my contribution to work for me in case I leave before I'm vested at 10 years and 3) I'm afraid they'll do away with my pension in the 30+ years before I retire and I'd like to be able to invest that money (my contribution) myself now. It's a moot point though since it's not within my control so I just contribute to my 457b and hope they don't substantially change the pension for existing employes.

[Miss Tequila]

My employer matches up to 5% and you are immediately vested. It still blows my mind the number of people that don't contribute...do they not understand they are giving up 5% of their salary? I've always maxed out and I understand that not everyone can...but come on, everyone should be able to contribute 5% o their salary. 

[Deleted]

Oct 20, 2014 8:53:42 GMT -5 Miss Tequila said:

My employer matches up to 5% and you are immediately vested. It still blows my mind the number of people that don't contribute...do they not understand they are giving up 5% of their salary? I've always maxed out and I understand that not everyone can...but come on, everyone should be able to contribute 5% o their salary. 

My employer matches 4% and the number of people that don't contribute at all is crazy.  One of my best friends here I just want to hit with a club.  He is so freaking stubborn.  10 years of excuses of why he can't put that 4% in.  First it was he was married to a spender, then he was divorced and couldn't afford it, now he's remarried and I was questioning about it a few months ago and he said the stock market was priced too high.   10 years.  He's just passed on somewhere between 15-20K in free money with just the contributions alone, who knows what it would be with the growth too. 

[midjd]

10 years. He's just passed on somewhere between 15-20K in free money with just the contributions alone, who knows what it would be with the growth too.

Using the $20K number in employer contributions, that would be $2K/year: 

According to my Phil Script, a monthly investment of $167.00 bearing an annualized return of 11% with gains compounded monthly could grow to $35,475.77 in 10 years!

So if he also contributed 4%:

According to my Phil Script, a monthly investment of $334.00 bearing an annualized return of 11% with gains compounded monthly could grow to $70,951.54 in 10 years!

Yikes!

[TheHaitian]

Oct 19, 2014 18:16:40 GMT -5 The Walk of the Penguin Mich said:

Oct 19, 2014 14:29:29 GMT -5 TheHaitian said:

Your employer is awesome!!!!

Not only that, they continue to contribute during my disability that 10%.  I can't contribute to it, so have been diverting those funds to an IRA instead.

Are they hiring?

[Deleted]

Oct 20, 2014 9:16:59 GMT -5 midjd said:

10 years. He's just passed on somewhere between 15-20K in free money with just the contributions alone, who knows what it would be with the growth too.

Using the $20K number in employer contributions, that would be $2K/year: 

According to my Phil Script, a monthly investment of $167.00 bearing an annualized return of 11% with gains compounded monthly could grow to $35,475.77 in 10 years!

So if he also contributed 4%:

According to my Phil Script, a monthly investment of $334.00 bearing an annualized return of 11% with gains compounded monthly could grow to $70,951.54 in 10 years!

Yikes!

In 9 years my 401K is 69K, so that's close!  Although, I've been contributing a lot more than 4%. 

[justme]

My company's match is 100% vested immediately. At first it was 1-for-1 match on 5%, but then they dropped it to 50% on 5% (so 2.5% if you contribute at least 5%).   

My employer contributes are around 1/3 of my retirement balance. 34% to be precise. It's basically all of my retirement - I have 200something sitting in a Roth IRA that I have been adding to until I get the min for a Vanguard/whatever account. Work situation is tenuous so I haven't added to it recently, but my 401k has some in Roth. Can't figure out how to see what %, but I've been contributing 2% to Roth for several years.