Another pay period has come and gone, and with that means another contribution has been made into my 401(k). As previously stated in my last blog post about my 401(k), I get up to a 6% match from my employer and so I only contribute 6% of my paycheck into this account. If I want to do additional saving and investing for retirement I go the route of my Roth IRA and my HSA.
These last two pay periods/contributions have been different because I changed up which funds I wanted to focus on growing this year. I have decided to go more heavy into the Growth fund and lighter on the 2060 Target Date fund. All funds have performed and treated me well, but I think I can get a little more from switching to more growth.
Although some people want to grow their 401(k)'s as much as possible by the time they are ready to retire, this isn't always the best option. This is because you may be hit with staggering taxes later in life. It's important to control how much your funds grow and what type of investment vehicle you have your money in.
But enough about the technical side of my retirement strategy, let's take a look at how the $226.69 from this pay period was distributed.
- Fidelity Growth Fund purchased 7.05 shares for a total cost of $158.69, bringing my total to 169.927 shares.
- Fidelity 500 Index Fund purchased .30 shares for a total cost of $34.01, bringing my total to 19.263 shares.
- Target Date 2060 Fund purchased 2.71 shares for a total cost of $33.99, bringing my total to 1,560.409 shares.
This is almost the exact same contribution as last pay period, so unfortunately it is not that exciting this time around. The real thing to keep an eye on is the total number of shares for each fund and see how much they grow over time. I like having a lot of shares of these funds because they pay out a juicy dividend throughout the year and it gets reinvested back into that same fund. Compounding is amazing!
As always, be sure to leave any comment, questions or concerns below!
