Updated for 2022.
Intel employees are eligible for a variety of comprehensive employee benefits
Here’s a list of what we think you should prioritize!
Participate in Intel’s 401(k)
The first thing you want to make sure to do is to contribute as much as you can to your Intel 401(k).
In 2022 you can contribute the following amounts:
- If you’re under 50, you can now contribute up $20,500 into the 401(k).
- If you’re 50 or older, you can throw in another $6,500 for a total of $27,000.
There are two ways that employees can contribute to their Intel 401(k):
- Traditional Pre-Tax 401(k):Make contributions before taxes. You get a tax break up front, lowering your current income tax bill; however, money withdrawn at retirement will be taxed.
- Roth 401(k):Make contributions after taxes. With this option, when you withdraw savings for retirement, you are not taxed.
When you contribute to the 401(k) you receive Intel’s 401(k) employer match.
Intel’s 401(k) Employer Match
Take advantage of the Intel match you when you contribute to your 401(k) Intel will match up to 5% of your salary if you contribute that amount.
- Let’s look at an example: If you make $200,000 and contribute at least $10,000, Intel will match that amount. Don’t turn down free money, so fund at least to the match.
Leverage the Mega Backdoor Roth feature within the Intel 401(k)
Three words – Mega Backdoor Roth. Another fantastic feature of the Intel 401(k) is that you’re allowed to put after-tax dollars over and above your pre-tax or Roth contribution and the Intel match. You can then convert these to Roth dollars and never pay tax again on these funds. This is known as the Mega Backdoor Roth or after-tax Roth conversion. Use it while you can, because it could go away in the next congressional budget battle.
Let’s take a look at an example.
- Let’s assume someone’s making $200,000 at Intel.
- This employee is under 50 and contributing the maximum amount into their 401(k): $20,500.
- Intel is going to match up to 5% of the employee’s salary, if the employee contributes at least that amount. So that’s an additional $10,000 from Intel. So now you and Intel have put in $30,500.
- Here’s what you may not know: The updated 2022 Federal maximum for total dollars going into a 401k is $61,000 ($67,500 if you’re 50 or older). This means you could put in another $30,500 in after-tax dollars and then convert these after-tax dollars to Roth dollars and then never pay tax on those dollars again.
Other Intel Employee Benefits (Employee Stock Purchase Plan – ESPP) and BrokerageLink
The benefits we mentioned above are the ones we would recommend you prioritize. We know Intel employees love their Employee Stock Purchase Plan – and for good reason. The ability to purchase Intel stock at a 15% discount is a great benefit. However, what if your cash flow won’t allow you to contribute to both the mega backdoor and the ESPP? Which one should you prioritize participating in?
We come down firmly on the mega backdoor Roth, because having your dollars invested in a Roth will provide you with long-term savings on future tax bills. We’re happy to set up a meeting to go through the numbers!
Align your investing with your values
You may want to consider BrokerageLink as an option to customize your 401(k). This option allows you to invest in a way that aligns with your values without necessarily compromising diversification or returns. You can access hundreds of SRI mutual funds and ETFs through BrokerageLink. These options allow you to create a sustainable portfolio within your 401(k, it is something we recommend despite the added extra cost.
Questions on where to begin with your Intel benefits?
We want to hear what is important to you. Please reach out to schedule time on our calendar.