Simple IRAs are new to me

Fraggable

Platinum Member
Jul 20, 2005
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I just started a new position at a medium-sized IT services company (17 employees) and am working through the initial paperwork, and they offer a 3% matching Simple IRA salary deferral plan. I'm trying to figure out what to contribute to it, and have no clue where to look for advice. My dad has never had an IRA plan so he doesn't know much about them.

My initial gut feeling is I should go ahead and sign up for the 3% matching, but that's not really based on anything.

Any input is aprecciated.
 

dullard

Elite Member
May 21, 2001
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Simple IRAs are just that: simple. It is what I have myself. By law (I think) you are limited to 3% contribution. Your company contributes up to 3%. So, the choice is simple. Do your max, and get the max free money: 3% each. You won't even notice the miniscule 3% being automatically removed from your paycheck so you shouldn't fear it. We aren't talking about much money at all.

6% total likely won't be enough to retire on, but it'll be a good start. You'll need another separate retirement account to really get enough to retire on comfortably. But that can wait a bit until you learn up about investments.
 

alrocky

Golden Member
Jan 22, 2001
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Employees: Up to 100% of compensation or a maximum of $10,000 for 2006 ($10,500 for 2007).
You want at least the 3% match which is free money.

What investment options are available?
 

mugs

Lifer
Apr 29, 2003
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Instant 100% return on your investment... tough decision. ;)

Contribute 3%.
 

Fraggable

Platinum Member
Jul 20, 2005
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Originally posted by: alrocky
Employees: Up to 100% of compensation or a maximum of $10,000 for 2006 ($10,500 for 2007).
You want at least the 3% match which is free money.

What investment options are available?

The IRA is all that's been presented to me so far, I don't know that there are any more options such as 401K.

I only make 30K right now so it's not like it's a huge amount of money but I want to start saving early on so I can retire early/well off.