How to Start a 401(k) – The 401(k) Launch Pad!

Embarking on your 401(k) journey is a crucial step towards securing your financial future. Here’s a comprehensive guide to get you started:

Contacting Your Employer

1. Reach out to your Human Resources department or benefits manager to inquire about the company’s 401(k) plan.
2. Ask if you’re already enrolled, as many employers now automatically enroll new employees.

Enrollment Process

1. Obtain enrollment forms from HR or access the online enrollment platform.
2. Gather necessary personal information:
   • Social Security Number
   • Date of birth
   • Address
   • Annual or monthly gross income
   • Pay frequency – most are paid bi-weekly, some are paid weekly or monthly.
3. Create an online account with the carrier if enrolling electronically.

Selecting Your Contributions

1. Choose between pre-tax or Roth after-tax contributions.
2. Decide on your contribution amount:
   • As a percentage of your salary
   • As a fixed dollar amount
3. Consider contributing enough to receive full employer match, if offered.

Investment Options

1. Review available investment funds:
   • Target-date funds (automatically adjust based on your retirement timeline)
   • Mutual funds – higher cost actively managed
   • ETF’s – Exchange Traded Funds – lower cost passive managed
   • Other investment options specific to your plan – more details on this here >>
2. If unsure, many plans offer a default investment option, often a target-date fund.

Completing Enrollment

1. Fill out all required forms or online applications.
2. Designate beneficiaries for your account – very important ( more on estate planning and beneficiary designation here >>
3. Review and accept plan terms and conditions.

Tracking Your 401(k)

1. Set up online access to your account through your plan provider’s website or app.
2. Regularly review your account balance, contribution levels, and investment performance.
3. Consider increasing your contributions over time to maximize your retirement savings.

Remember, starting your 401(k) is just the beginning. Regularly review and adjust your plan to ensure it aligns with your evolving financial goals and retirement timeline.