Yesterday on a whim I decided to increase my contributions to my 401k. I went from contributing 6% to 10%. It’s quite a jump and I’ll be interested to see how much it changes my paychecks. I’m not really sure that it’s ever a good idea to do these kind of things on a whim but I just felt like I could afford to invest some more and stocks are definitely “on sale” right now.
Whether this increase was a good or bad move, only the future can tell us. Once I get my paycheck and I see how much it actually changes my take home pay, I may decide to scale it back down if I need to. However, my main goal is doing this is to get used to less money in my check and then just “forget” about my 401k and not be continuously tweaking my contributions.
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I think it is fine to make it on a whim, especially since if, after a paycheck, you decide the increase is too much, you can back off. Personally, I’ve been fighting with myself all month to NOT decrease from 10% to 8% to get the extra cash!