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Author: aj485 Big gold star, 5000 posts Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 76082  
Subject: Re: I think I am missing something Date: 3/24/2011 12:22 AM
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Contributing more than 6% in a given paycheck will not cause my employer to match any more than 3% for that paycheck. It will also not cause my employer to contribute any more than the 3% if I stop contributing for the year. In other words, the matching is done on a per-paycheck basis and there is no "annual" calculation that is done, other than the annual max for the employee contributions.

This is how most of my previous plans have done their matching - so if you miss contributing for a paycheck, you miss part of the match you would have otherwise been entitled to.

On the other hand, my current plan does a 'true-up' to ensure that employees get the entire match. So detailed is their 'true-up' that in early February this year, I got an employer match contribution of $0.03 I checked the numbers for 2010, and sure enough, even though my contributions were distributed throughout the year and I had more than the matched amount contributed from each paycheck, because of rounding, my match during the year was $0.03 short of the full match.

So, the OP needs to check their plan to determine how the match is calculated, and if there is a true-up. If there isn't a true-up, it would probably be best to adjust the contributions so that the amount that is being matched is contributed from each paycheck, as a few months of additional gains (or losses) is unlikely to make up for the missed match.

AJ
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