Episode 2
Missing the Match | Series 9.2
What is the best kind of money? Free money, of course!
- A matching component is where they will give you essentially free money, the match, up to a certain percent. (01:15)
- Some plans might have a vesting feature or having to work there aka for a certain amount of time before you get the match. But nonetheless, a path to free money, a 100% return on what you put in. (01:52)
- So for example, you are making $100,000 and your work has a 5% match. By putting in 5% of your own money, you get another free 5% from the company. (02:05)
Quote for the episode: "You are essentially doubling your money, which is not helpful if you again are wanting to avoid accumulating wealth. Now if you are wanting to try to accumulate wealth, this is obviously a great way to go about it." (01:36)
Securities offered through TFS Securities, Inc., and Advisory Services through TFS Advisory Services, an SEC Registered Investment Advisor Member FINRA/SIPC. TFS Securities, Inc., is located at 437 Newman Springs Road, Lincroft, NJ 07738 (732) 758-9300.
Transcript
Welcome to the Enjoy More 30s Family Finance
Voiceover Audio:podcast. The only podcast dedicated to making life more
Voiceover Audio:enjoyable for young families by hitting on the financial topics
Voiceover Audio:that tend to weigh on us, stress us out, and distract our focus
Voiceover Audio:from simply enjoying life.
Joseph Okaly:Hello, and welcome once again to the Enjoy More 30s
Joseph Okaly:Family Finance podcast. For all those people out there trying to
Joseph Okaly:avoid being financially secure, we have our series 10 Ways to
Joseph Okaly:Not Be a Millionaire. Now if you actually do want to be a
Joseph Okaly:millionaire, not to worry, this series isn't just for those
Joseph Okaly:people who are looking for financial instability. If you
Joseph Okaly:avoid doing these 10 things, then you could be well on your
Joseph Okaly:way to millionairehood as well. Each week I'll share a quick
Joseph Okaly:step in this how to not be a millionaire process. So you know
Joseph Okaly:what to do or hopefully what to avoid at all costs.
Joseph Okaly:As always, before I begin, please share and like please
Joseph Okaly:leave reviews, I'd love to reach and help as many young families
Joseph Okaly:out there just like you.
Joseph Okaly:Today's great tip on how to not be a millionaire is by Missing
Joseph Okaly:the Match. Most people out there have a retirement plan at work.
Joseph Okaly:Most of these plans likewise have a matching component. What
Joseph Okaly:is a matching component you may ask. A matching component is
Joseph Okaly:where they will give you essentially free money, the
Joseph Okaly:match, up to a certain percent. So if the match is 4%, then if
Joseph Okaly:you put in 4% of your own salary, they will give you a
Joseph Okaly:free 4%. So if you want to not be a millionaire, this is
Joseph Okaly:certainly something that you are going to want to be avoiding.
Joseph Okaly:You are essentially instantly doubling your money, which is
Joseph Okaly:not helpful if you again are wanting to avoid accumulating
Joseph Okaly:wealth. Now if you are wanting to try to accumulate wealth,
Joseph Okaly:this is obviously a great way to go about it. What is the best
Joseph Okaly:kind of money? Well, free money of course! Some plans might have
Joseph Okaly:a vesting feature or having to work there aka for a certain
Joseph Okaly:amount of time before you get the match. But nonetheless, a
Joseph Okaly:path to free money, a 100% return on what you put in. So
Joseph Okaly:for example, you are making $100,000 and your work has a 5%
Joseph Okaly:match. By putting in 5% of your own money, you get another free
Joseph Okaly:5% from the company. So essentially an equivalent to 10%
Joseph Okaly:of your salary every year is going into your plan. In 30
Joseph Okaly:years at 7% you wind up at $1 million. If you are trying to
Joseph Okaly:not be a millionaire, this is obviously something you'd want
Joseph Okaly:to avoid. Saving somewhere else and not getting the match means
Joseph Okaly:you would only get the 5% you put in no free money whatsoever.
Joseph Okaly:So after the same 30 years at 7% growth, you only end up around
Joseph Okaly:$500,000...much, much, much less. Overall I think it is more
Joseph Okaly:than clear that missing the match is a fantastic way to not
Joseph Okaly:be a millionaire.
Joseph Okaly:Thanks for tuning in today and join us for next week's episode
Joseph Okaly:on how to not be a millionaire, Rushing Past the Roth. As
Joseph Okaly:always, please remember to review and share for others and
Joseph Okaly:if you need any help, don't hesitate in reaching out. I
Joseph Okaly:probably have helped someone just like you. Until next week.
Joseph Okaly:Thanks for joining me today and I look forward to connecting
Joseph Okaly:with you again soon.
Voiceover Audio:The conversations on this show are
Voiceover Audio:Joe's opinions and provided for general information purposes
Voiceover Audio:only. They do not constitute accounting, legal, tax, or other
Voiceover Audio:professional advice for your specific situation. You should
Voiceover Audio:always seek appropriate advice from a financial advisor,
Voiceover Audio:accountant, lawyer, or other professional before acting upon
Voiceover Audio:any content or information found here first. Joe is affiliated
Voiceover Audio:with New Horizons Wealth Management LLC, a branch office
Voiceover Audio:of TFS Securities, Inc., and TFS Advisory Services an SEC
Voiceover Audio:Registered Investment Advisor, Member FINRA/SIPC.