Floor 49: Saving For Retirement

In the past few years, I’ve taken the following (sometimes floundering) steps toward full adulthood:

  • Paying off student loans?  Check.
  • Share a home with the world’s best dog?  Check. (Just kidding.  Not actually a requirement for becoming an adult.  Probably).

Sigh.  I guess the next logical step is . . . CUE OMINOUS MUSIC . . . saving for retirement.

I’ll be the first to admit that at 31, I’m probably starting a little late.  After all, some people have already retired by my age.  However, as always, no time like the present to start fixing tomorrow’s problems.

And so, this year I started seriously contributing to my work’s 401K.  Luckily for me, it turned out to be pretty easy.  Like most people of my generation, when confronted with a problem that I lacked any expertise in, I turned to the Internet for advice.  The consensus seemed to be:

  1. Max out your 401(K), if you can.
  2. Invest in low-cost index funds.  The low cost part is very important.  The index funds part is also very important, because only someone a lot smarter and more knowledgeable than me should try to beat the stock market.
  3. The End.

OK, so, not so bad.

I mean you can make it tricky.  You can get fancy with tax deferral strategies like Back Door Roths or super complicated allocation of funds or stuff like that.  But, you know, with a kid and a house and a husband and a job, fancy is not on the To-Do List.  And as a general rule, I don’t do things with either my money or my taxes when I don’t understand them, and I decided I’m not using my last two spare brain cells on this.

So I:

  1. Set up my paychecks to contribute just slightly under the maximum to my work-sponsored 401K.  (Laziness at work here.  I could have hit the maximum, but it would have required annoying fiddling with the website AND MATH – long story – so I settled for a few hundred bucks short of the maximum).
  2. Like most firms, mine does not do any 401K matching.  It is what it is.  On the other hand, my firm has its 401K plan with Vanguard, and offers numerous low cost index funds.
  3. Set up the deductions to automatically deposit into broad-based index funds, mostly in stocks.
  4. The End.

Maybe one year I’ll get fancy.   You know, right about the time my kids are in school and I find the time to rotate my wardrobe with the seasons.

Until then, I’ll have money being invested and compounding in a retirement account.  Just like a real adult.


The Only Asset Baby Debt Free JD Appreciates.


2 thoughts on “Floor 49: Saving For Retirement

  1. Biglaw Investor

    I LOVE this. You’re doing everything right. And 31 isn’t that old, especially for us JDs who decided to spend our 20s acquiring all kinds of fancy education.

    People make it so much harder than they need to, when in reality they need to get started just like you’ve done. Some day later you can play around the margins and tweak things like asset allocation / asset location.

    In fact, the next thing for you should be a backdoor roth. It’s actually not nearly as complicated as it sounds. I’ll put together a post this Spring with a step-by-step for how you do it at Vanguard. It’ll take you like 60 minutes at the most.

    1. Mrs. DebtFreeJD Post author

      I’ll trust you that a backdoor roth isn’t as complicated as it sounds, since right now it sounds to me like something that is illegal in Saudi Arabia, or possibly a mixed drink in a Soho cocktail bar. Looking forward to reading your step by step article!

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