<< My company is nice enough to match the first 3% of my contribution 100% and the next 3% contribution is matched 25%. If I invest 6% I get a free 3.25% from the company. You don't have to be a Fool to understand it's free money but should I invest the full 15%? or just the 6% and take my other 9% elsewhere? >>Ray replied: <<I believe that, in general, the optimal ordering would be: 1) deductible IRA (if eligible) 2) 401(k), enough to capture the entire employer match 3) Roth IRA (if you can't do #1) 4) Max out the balance of the 401(k) 5) ordinary taxable account.>>Shouldn't #1 and #2 be reversed? A deductable IRA can't reasonably outperform the 62% free money, even if the 401(k) gets a 0% return.Linne
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