Reviewing your retirement accounts


Now is a good time to analyze what you have and don’t have

Hello everyone. Now that the holidays are over and 2019 is underway, I thought it would be an opportune time to review the 401(k) and all other retirement assets and why they are so important, the advantages they offer, and how to stay consistent with your retirement savings. As you analyze what you have and don’t have, I encourage you to think about some of these issues and reach out to your financial professional with any questions and/or concerns. Let’s begin.

I’ll start with the 401(k) because, in my view, it is the most cost-efficient way for most Americans to save for retirement. Now, there are many different factors to consider when analyzing your 401(k) account with your employer.

Does my employer offer a company match? If so, what is it and am I maxing that match out?

A company match is a very attractive aspect of 401(k) planning because your employer is rewarding you for saving for retirement. If your employer does indeed offer a company match, be sure to max that out and get the most out of your 401(k). If you can’t afford to do that currently, don’t beat yourself up. Save what you can and increase your contribution gradually.

What is the vesting schedule?

The word vesting is a fancy way of saying ownership of your 401(k) account. Any money you deduct out of your paycheck is always 100 percent yours. However, in many instances the employer matching contribution does follow a vesting schedule, usually based on years of service. Be sure to have a clear understanding of how the vesting schedule of your 401(k) account works.

Does my employer’s plan offer a Roth 401(k) option?

This is a very important thing to consider when analyzing your retirement savings. Many people confuse the Roth 401(k) with the Roth IRA but they are very different. First, there are no income restrictions to have a Roth 401(k) account like there is to open a Roth IRA. And secondly, you can save a higher dollar amount per year in a Roth 401(k) versus the Roth IRA (more on this to come).

What am I invested in and why?

This is something that should apply to any and all investment accounts you own regardless of whether those are retirement assets or not. You should be receiving statements with details of your accounts including asset allocation and returns. It is crucial to understand what fund(s) you are invested in, and if those investments align with your specific needs and risk tolerance. Like I have said in the past, the 401(k) is important, but it is not the only thing you should be considering. Thus, be sure that your 401(k) investments are in line with your overall financial plan. If you find they are not, talk to your advisor about what changes need to be made. These questions are great starting points when analyzing your employer’s 401(k) plan and, with the new year underway, I encourage you to sit down and review what is on the table.

There have been some important changes to the 401(k) and IRA environments regarding contributions starting in 2019. The maximum dollar amount a person can defer into a 401(k) account has increased from $18,500 in 2018 to $19,000 in 2019. This does not include any employer match dollars. In addition, the annual catch up provision provided investors over the age of 50 to contribute an additional $5,000 in 2018. That has increased to $6,000 in 2019. Meanwhile, the maximum contribution a person can make to an IRA has increased to $6,000 in 2019. If you were maxing out either your 401(k) or IRA accounts in 2018 and wish to continue to do so this year, be sure to contact your advisor to make the necessary adjustments.

Knowing and reviewing what you are doing to save your retirement is very important, and I always recommend to my clients to complete this activity multiple times per year. As always, your financial advisor works for you so be sure to reach out to him or her with any questions you may have.

Article Written By David Wentz

David Wentz is CEO of Tax Favored Benefits, Overland Park, Kansas. Wentz is a graduate of the University of Kansas School of Law with a Juris Doctor degree. Wentz frequently speaks at various professional and business seminars about pensions, profit sharing, 401(k) plans, tax favored benefits, and investment programs. Western Equipment Dealers Association endorses Tax Favored Benefits as a 401(k) provider. No compensation is received. More information is available at

Securities and investment advisory services offered solely through Ameritas Investment Corp. (AIC). Member FINRA/SIPC. AIC and Tax Favored Benefits, Inc. are not affiliated. Additional products and services may be available through David B. Wentz or Tax Favored Benefits, Inc. that are not offered through AIC. Securities email:


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