Tomorrow will officially mark my one year anniversary at my new job which means that besides having been in this roller coaster of a stressful job for a whole year, I am now eligible for company 401(k) matching. The big question is "should I go for it?" The company matches up to 4% if I contribute 5% which is probably the only way I'm going to get any more money out of this company given everything that has gone on lately.
According to Dave Ramsey I am better off putting all of my financial resources towards paying off my debt in as short amount a time as possible. And I can really understand why that advice makes sense. However, I have not been able to contribute to a retirement plan for almost 4 years: three because of constant pay cuts at my last job that sent me re-arranging my finances ever couple months to stay above water and the last year because I wasn't yet eligible to participate. If I stick to my current debt pay-off plan it will be another 5 years before I'll be debt-free and that doesn't take into account all the "what-ifs" that could happen in that amount of time... like me or S losing a job or starting a family.
So that makes almost a decade of no retirement savings which I think even Dave Ramsey would say is too long to put off planning for retirement. Perhaps I need to look at my debt in terms of "good" debt vs. "bad" debt: http://money.cnn.com/magazines/moneymag/money101/lesson9/index2.htm. My "good" debt is my student loan, it's the bulk of my debt but it's at a really low interest rate and it helped me get the jobs that will eventually pay it off. My "bad" debt includes my credit cards with their high interest rates and my car loan even though the interest rate on that is low.
I should be able to pay off the "bad" debt within the next two years. That seems like an amount of time to continue putting off saving for retirement that I can feel comfortable with.
What would you do? Push off saving until all debt is paid? Start saving now regardless of debt? Or split the difference and pay off the "bad" debt before saving?