The 401K and I: A Love/Hate Story

I currently invest in a 401K account with a complete 3% match by my employer, followed by a 50% match of the next 2%. This is not a great matching plan, but it's better than no match, or not being offered a retirement plan at all. This I like.

What I don't like is when I somehow manage to blow an extra $200 *cough*last month*cough*. Now I have to transfer what little money I put into my savings account back into my checking account. Just $100. Not nearly the $150 I was striving for originally, but now I guess I'm glad. Sort of.

Anyways, my new plan acts as sort of a punishment and a reward for myself, if that can make any sense whatsoever. Anytime I spend all of my extra money unnecessarily, I am going to up my 401K contribution by 1%. This is something like 7.00 each pay period. I figure if I can afford to spend $200 on god-knows-what, then I can afford to save an extra 7 dollars for my retirement. 15 dollars extra each month, or thereabout. It fluctuates depending on how many hours I work and how much overtime is on my check, but the average is the same.

Right now I have $490 in my retirement fund with Vanguard. I've only been funding it since January and no, I do not make a ton of money. But I live within my means, most of the time. I survive on what little I have and generally don't go waste a bunch of money on useless trinkets. We all have our bad days occasionally though. I just need to learn to keep them in check.

So, for now, Mr. 401K sits at a whopping 7% pre-tax contribution. Up from the 6% it's been at since February. He and I are going to be friends for a long time, I hope.