Where to Put the 15%
What should you do when your employer stops matching your 401(k) contributions?
Dave's ANSWER: I would put 100% of my retirement savings into a Roth IRA in good growth stock mutual funds before I did anything in a non-matching 401(k).
Our goal is for you to be debt-free first and have an emergency fund of three to six months of expenses in Baby Step 3. Then Baby Step 4 is to save 15% of your income into retirement, and you won't be doing anything until you get there.
The first portion of that 15% should be in matching 401(k) plans. If you don't have a matching 401(k), you move on to number two, which is a Roth IRA. All of these needs to be invested in good growth stock mutual funds with long track records, and then the rest of the money goes into non-matching 401(k) plans. But you do those until you get up to 15%.
Right now, in 2012, you and your husband can put $5,000 each into your Roth IRA. With two of them, that's $10,000. But if you have a $100,000 income, that's only 10% of your income. You'd need to do a non-matching 401(k) and get the other $5,000 out there because you need $15,000 going out there in Baby Step 4.