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Employer doesn’t match? Oh well.

Dear Pete,

My employer doesn’t match my 401k contributions. Is it still worth putting any money into the plan? I can’t imagine the plan is any good, if they don’t have a match.


The match is an incentive to contribute. Have one? Great. Don’t have one? Oh well. It shouldn’t impact your contributions whatsoever. I’d prefer you think of your employer’s match as a raise. Again, if you get one, great, if not, okay then.

Reality is, you need to save for retirement. What your employer does to incentivize you is irrelevant. You need to contribute, or you won’t have a retirement.

As for your assertion that no match equals bad plan, I can’t get behind the logic. The quality of your employer’s 401(k) investment options aren’t necessarily related to whether or not your employer offers a match. I’ve seen a great match with poor investment options and vice versa. That being said, if you don’t like your plan’s investment options, the simple alternative is to open and contribute to an IRA or a Roth IRA.

Bottom line is you need to contribute to a retirement plan. Everything else is just noise.