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Unexpected Windfall

April 17th, 2015 at 03:46 pm

So, we got a good surprise yesterday.

We received a letter from husband's work that they have a Profit Sharing plan.

It said as of December 31st 2014 that his account balance is $2,600 and that he is 20% vested.

That means if he quit today he would be given 20% or $520 right? That's pretty cool!

That just doubled our current retirement money! I like free money!

I'll have to do some more reading on profit sharing, I don't really understand it.

8 Responses to “Unexpected Windfall”

  1. creditcardfree Says:

    That is great news and yes your math is right.

  2. MonkeyMama Says:

    That's great! It's basically a retirement plan that the employer contributes to instead of the employee. If they ever close the plan or he leaves, he should be able to roll vested funds into an IRA. Of course, there are different kind of profit sharing plans, but since you mentioned it was a retirement account, I presume it's that kind. people).

  3. MonkeyMama Says:

    P.S. LOL @ my "people" typo. I can't fix it. Ignore that last part.

  4. klarose Says:

    That would be awesome if they continue adding that much every year. That would double our retirement contributions yearly. We could live just fine if we continue saving $2,500 a year until we retire. Saving twice that much will get us there that much sooner.

  5. MonkeyMama Says:

    Have him ask for the "Plan Summary Description". Or maybe that is with the letter you received? It could be they have to pay a certain percentage (of salary) as a minimum and/or they may just be making additional discretionary contributions as they have the funds. He should ask some questions about that, for sure. See how much they have been contributing or plan to contribute in the near future.

  6. Amber Says:

    That is great news Smile

  7. FrugalTexan75 Says:

    Awesome news!

  8. klarose Says:

    MonekeyMama, I'm pretty sure they just contribute what they want. It didn't have a percentage of his income on there.

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