Financial Education 202: Get any “Free” Money

Specifically I’m talking about employer 401(k) contributions. If your employer matches a certain percentage of your 401(k) contributions, be sure you contribute at least that much! If your employer matches dollar for dollar on the first 6% of your salary that you contribute, make sure you contribute at least 6%. It’s like getting a 6% raise in that case. 

However, it’s not just these contributions that you should watch out for. If you work at an employer that still has a pension, then getting that to vest means that assuming you live to retirement age, that’s a stream of money for life, or perhaps a lump sum when you leave the company. Either way, we’re probably talking about thousands of dollars worth of money, however, you have to be vested and stay the maybe three years or five years to take that pension with you when you leave the company. The same goes for stock options, although I’ve certainly never gotten far enough up the corporate ladder to get any of those. 

Another way that you might have “free” money is if you have any unclaimed tax refunds, insurance claims, inheritances, old retirement accounts or pensions that you forgot about. There are billions of dollars of money in the United States where the owner, and the government or the company holding the money are not in contact with each other. Certainly this applies more likely to older people that have had several jobs, but it is something to keep in mind every year as you do your taxes to make sure that if you are getting a refund, you actually get it.

Another aspect of this are employee perks such as free coffee. You certainly don’t need to take advantage of it, but if someone is giving you decent free food, there is no shame in eating it.