The email subject line was "Your quarterly statement is ready," and I had been deleting that exact email since 2022. This time I opened it, mostly because I was tracking every dollar of my June spending for the club sheet and it felt silly to account for a $14 sandwich and not for my retirement account.
I've had 5% of every paycheck going into my 401(k) since I started my billing job in Skokie in August 2022. I set it up during orientation because the HR person said "most people do at least enough to get the match," and I wanted to be most people. Then I never looked again. I didn't know my login. I had to reset the password twice.
What the balance was
About $11,200. I said the number out loud in my room, and my mom asked from the hallway if I was okay.
Here's roughly how it got there, according to the statement and a little arithmetic. My plan made me wait 90 days before I could contribute, so my money started in November 2022. The employer match only started after a full year on the job, in August 2023. So in round numbers:
- My own contributions: about $6,200 over 32 months, at 5% of a $46,500 salary.
- The employer match: about $3,600 since it kicked in, at 4% of my salary.
- Market growth: about $1,400, which is the part I did absolutely nothing to earn.
That math is 6,200 + 3,600 + 1,400 = 11,200, give or take a few dollars of rounding. The match is the line that got me. That's $3,600 my employer put in because I put in mine. If I'd skipped the 401(k) to throw more at my credit card, I'd have left all of that on the table.
Things I didn't understand until this week
The statement had a lot of words I'd been nodding along to. A few I finally looked up:
Vesting. My contributions are always 100% mine. The match vests on a schedule, which means if I'd quit early, I might have had to give some of it back. I'm past the point where it matters at my job, which I double-checked in the plan document, not on a forum.
What it's invested in. I was in the plan's default target-date fund, the kind that's meant for people retiring around a certain year and gets more conservative as that year gets closer. I'm not going to tell anyone what to invest in, but I read the fund's one-page summary, looked at the fees, and decided I was fine leaving it there.
Beneficiary. The beneficiary line was blank. That means if something happened to me, the money would go through a slower process than it needs to. I wrote "name a beneficiary" in my planner. I'm writing that sentence publicly so I'm embarrassed into doing it soon.
What I changed
Not my contribution rate. I thought about it. I'm paying $1,100 a month on my student loans right now, and every extra dollar I could pull from the 401(k) would technically go further on a 5.05% loan. But cutting below 5% would mean losing part of the match, and the match is an instant 80 cents on every dollar I put in, up to the limit. Lowering it to pay loans faster didn't make sense to me. Raising it can wait until the loans are gone. That's my reasoning for my situation, not advice.
What I did change:
I set up the login properly and saved it where I keep everything else. I turned on paperless statements, which sounds backwards, but it means the email now goes to a folder I actually check. I put a quarterly reminder in my notes app: "open the statement, write the balance in the club sheet." And I added a new row to the club sheet called "401(k)" so the number sits next to my loans and my emergency fund, instead of somewhere I pretend doesn't exist.
The weird feeling after all this was that I'd been doing one thing right for three years without knowing it. Past me set up one good habit on day one and then ignored it. I'll give her that one.
