Davis Motor Sales banner ad

dave says1KENTUCKY (11/17/13) – This week Dave discusses 'Count employer contribution?' and 'Teaching teenagers about giving'

Dear Dave,
Do employer contributions count toward the 15 percent you recommend putting into retirement? - Brian

Dear Brian,
Employer contributions do not count toward the 15 percent I recommend setting aside for retirement. It’s nice if you work for a company that offers perks like that, but I want you putting 15 percent of your money into retirement.

Baby Step 4 of my plan says to put 15 percent of your income into retirement accounts. The first thing you should put money into is a matching retirement account. If you’ve got a 401(k), a Roth 401(k) or a 403(b) and your employer offers a match, you should do that up to the match before anything else.

Let’s say your employer will match three percent. Since the goal is 15 percent, you’ve still got some work to do. You’ve got three percent of your own money already tied up for retirement, so then you could look at a Roth IRA. If the Roth plus what you invested previously to get the match doesn’t equal 15 percent, you could then look at a 403(b) or go back to your 401(k) to hit the 15 percent mark.

Whatever your company matches, whatever its pension may be or even military retirement does not enter into the equation. I want your money in your name. If your company goes broke and you have a company pension, you get nothing. But if you have a 401(k) and your company dies, it’s in your name and you don’t lose it. You put it there, you own it. And that includes the match.

Are you getting the picture, Brian? I want you to control your destiny! - Dave

Dear Dave,
What are some good ways to teach a 13-year-old kid about giving versus getting during the holiday season? - Phillip

Dear Phillip,
One of the best things you can do is simply talk about it—a lot. Kids are bombarded with messages about how important they are, and how they should always have what they want. It’s okay to have some stuff, but advertising and other marketing messages in today’s culture can make them think it’s all about them. It can lead kids to believe the axis of the world runs through the tops of their little heads.

Think about this. In 1971, the average person saw 564 advertising impressions a day. Now, that number is about 4,000. The purpose of advertising is to disturb and influence you to the point that you’ll buy something. Advertisers want you to believe that you’re not complete without their product, or that you’ll be a happier, cooler, better person with their product. And in most cases, advertising and marketing people are more aggressive in their teaching than parents are in theirs.

My suggestion is to find some giving exercises in which you can all participate. You could adopt a single mom at your church. Make it a family outing, and go buy groceries, gifts for her kids or even a Christmas tree. Make sure your kids are involved physically, mentally and emotionally in the entire giving process. Let them experience the grateful, and sometimes ungrateful, responses that go along with giving. And make sure you do some things that don’t involve money. You could take the entire family to help cook and serve dinner at a homeless shelter.

One of the best things we ever did as parents with our teenagers was to send them on mission trips. It truly changed their lives. When you see real poverty close up, when you live and walk and sleep in it day after day—I’m talking about death-and-disease poverty, not the American version—it changes your heart. And when you’re 13, it will change your life forever. - Dave


Tips for Surviving Christmas Financially

1.It’s not an emergency. Christmas is not an emergency, it happens every year. Don’t use this as an excuse to overspend and buy things you can’t afford.
2.Make a Holiday Budget. Make a list of everyone you are buying a gift for, and put a dollar amount by every name. Total it at the bottom. This is your Christmas budget. You can also check out www.mychristmasbudget.com, a free online budgeting tool to help you easily keep the holidays from wrecking your finances.
3.Pay cash. Put the total from your budget in an envelope, and when the cash is gone stop spending. This will help keep you on budget because if you overspend on Aunt Sue, Uncle Harry won’t get a gift!
4.Avoid debt. If you’re running a little short on cash, talk to your family about spending expectations. Draw names, set price limits or get creative. Whatever you do, don’t go into debt. It’s not worth it!

* Dave Ramsey is America’s trusted voice on money and business. He’s authored four New York Times best-selling books: Financial Peace, More Than Enough, The Total Money Makeover and EntreLeadership. The Dave Ramsey Show is heard by more than 6 million listeners each week on more than 500 radio stations. Follow Dave on Twitter at @DaveRamsey and on the web at daveramsey.com.

 

Disclaimer: The content supplied by columnists and letters to the Editor on this site does not in any way, shape or form, implied or otherwise, necessarily express or suggest endorsement or support of any of such content, statement, or opinions therein. SurfKY News does not necessarily adhere to or endorse content provided by outside non-staff sources.

© Copyright 2015 SurfKY News Group, Inc. All rights reserved. This material may not be published, broadcast, or rewritten without permission. SurfKY News encourages you to share this story on social media.

Posted on 2/2/14
3/13 - 16
3/13 - 16

Most Read This Week

February 25, 2015 7368

Multi-Agency Investigation Nets Large-Scale Meth…

in Top News For All Sites by Trooper Stu Recke
February 24, 2015 7231

Two Charged in Central City Meth Bust

in Local (Muhlenberg) Top News by Trooper Stu Recke
February 22, 2015 7083

Easter Cuties Pageant in Memory of Shanice Bean

in Top News For All Sites Touching Hopkins by Tammy Holloway, SurfKY News
February 25, 2015 6105

New Asian Restaurant Coming to Madisonville

in Local (Hopkins) Top News by Gary Gates, SurfKY News
February 23, 2015 4882

Fire Departments Respond to Wester's Body Shop

in Local (Muhlenberg) Top News by Shawn Freels
February 24, 2015 4570

School Board Holding Special Called Meeting

in Muhlenberg News by Sherri Miller

Most Read This Month

February 12, 2015

UPDATE: Name of Pennyrile Fatality Officially…

in Top News For All Sites Touching Hopkins by Doreen Dennis, SurfKY News
February 09, 2015

Police Pursue Man after Fight at Taco Bell

in Local (Hopkins) Top News by Madisonville Police Department/Hopkins County Detention Center

Stories Trending Today

March 02, 2015 2615

Madisonville Teen Faces Numerous Drug Charges

in Local (Hopkins) Top News by Madisonville Police Department/Hopkins County Detention Center
March 01, 2015 1654

HCCHS Student Has Unique Eye for Art

in Local (Hopkins) Top News by Amber Averitt, SurfKY News
March 01, 2015 1361

4H Penguin Plunge Draws Hundreds to Poolside

in Local (Muhlenberg) Top News by Paul McRee, SurfKY News
March 01, 2015 1053

Dave Says - March 1, 2015

in General News For All Sites by Dave Ramsey
March 01, 2015 1028

Whitfield Meets with American Financial Services…

in General News For All Sites by Robert Hankins
March 01, 2015 996

West Broadway Vendor Event, Tag Sale Planned

in Local (Hopkins) Top News by Tammy Holloway, SurfKY News
March 01, 2015 975

Legislator's Log - Week of March 1, 2015

in General News For All Sites by Brent Yonts
March 01, 2015 956

Libraries’ Drawing Contest Begins March 2

in Local (Muhlenberg) Top News by Amie Waltrip
March 01, 2015 924

Kentucky Offers Tax Credit to Small Business…

in General News For All Sites by Joe Hall
March 01, 2015 895

Outdoor Truths - March 1, 2015

in General News For All Sites by Gary Miller