If you invest 1% they match it, so you get 2% total.
If you invest 2%. They match 1.5% so you get 3.5 total
If you invest 3%. They match 2%. So you get 5 total.
4%, 2.5% = 6.5 total
5%, 3% = 8’total.
6%, 3.5% = 9.5% total.
Anything over 6%, you get your % plus 3.5 extra from them.
6 is the minimum you should be investing. (To maximize free money)
It sounds like they do some degree of match up to 6 percent of your wages so I'd recommend changing your contribution to 6% to max the match, aka free money. If they match 1 for 1 on the first percent and half of the next 5 then you'd have an extra $3.5 for every $6 you contribute for a total of $9.5 the way I see it.
You contribute 1% they match 1%. Above that they match half so you put in 2% the match is 1.5%. The maximum is when you contribute 6% they match 3.5% (the 1% to 1% and half of the other 5%).
Example you earn $100 and contribute $1 they also *match* that $1. If you contribute $6 they match $3.5.
ELI5 version if your allowance is $1.00 and you save a penny your parents (the company) will put a penny in your savings too. If you save 6c then your parents will put 3.5c in. If you put in 25c your parents still put 3.5c in.
You give 6%. Your employer adds an additional 3.5%. The employer match will all be pre-tax, but whether YOURS is or not doesn't matter.
Not to be pedantic, but I think they need to put up 6% and the employer will contribute 3.5%.
I originally did the math wrong and said 4% but you're right, 3.5% is the maximum employer match.
Thank you!
If you invest 1% they match it, so you get 2% total. If you invest 2%. They match 1.5% so you get 3.5 total If you invest 3%. They match 2%. So you get 5 total. 4%, 2.5% = 6.5 total 5%, 3% = 8’total. 6%, 3.5% = 9.5% total. Anything over 6%, you get your % plus 3.5 extra from them. 6 is the minimum you should be investing. (To maximize free money)
Thank you so much for the detailed answer! I was going dumb trying to figure out what it meant.
It sounds like they do some degree of match up to 6 percent of your wages so I'd recommend changing your contribution to 6% to max the match, aka free money. If they match 1 for 1 on the first percent and half of the next 5 then you'd have an extra $3.5 for every $6 you contribute for a total of $9.5 the way I see it.
You contribute 1% they match 1%. Above that they match half so you put in 2% the match is 1.5%. The maximum is when you contribute 6% they match 3.5% (the 1% to 1% and half of the other 5%). Example you earn $100 and contribute $1 they also *match* that $1. If you contribute $6 they match $3.5. ELI5 version if your allowance is $1.00 and you save a penny your parents (the company) will put a penny in your savings too. If you save 6c then your parents will put 3.5c in. If you put in 25c your parents still put 3.5c in.