So I’m getting laid off at the end of August. I normally max out my 401k each year ($18,500 as under 50) but trying to decide what to do this year. I get 1 month severance (after 23 years) and already have vacations planned for September so will not start any new job until October at the earliest. I’m wondering if it’s best to just max out my 401k with current employer to be sure I get full 401k for 2018 as I have no idea when I will get a new job or if they have waiting period for new employees contributing to 401k.
The caveat is that my current employer only puts their match in for the entire year if you are working on December 15 which means that I will get no match for the entire year with my current employer. But suppose I don’t find a new job until January 2019 or I find a new job and they make you wait 6 months before joining 401k, I’d hate to lose putting in the full amount into 401k for 2018. I’m just over 1/2 in for the year now.
I’m thinking of updating 401k amount in next 4 days so last 4 paychecks can pull out enough to hit my $18.5k for the year. Any reasons why this is a bad idea? I could also put in $17k or so to leave some room in case I get a new job that matches from day one.
Not sure if it matters but wife and I are in high tax bracket and used to pay AMT but not sure under new tax laws what taxes we’ll pay. We live in NJ so have high SALT but not enough to skip the $24k standard deduction due to $10k limit. I’m thinking it’s just good to lower taxable income even though I don’t get a match but want to make sure I’m not missing anything.