In deciding whether you will participate in a 401(k) plan, you must first determine if you have the cash flow to put into long term savings. This means, take a look at your total income and annual expenses, planning for larger expenses like car repairs. Ideally, try and contribute to the 401(k) at least enough to get the maximum match offered by the employer—it’s like receiving free money!

Sharon Rich, Ed.D., runs WOMONEY, a Boston-based, fee-only financial planning practice. Rich specializes in the financial needs of women and families, with an emphasis on nontraditional families and Socially Responsible Investing. Rich co-authored The Challenges of Wealth: Mastering the Personal and Financial Conflicts, and has been twice named as one of America’s top financial advisors by Worth magazine.
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