401(k) Champion: Kennith Warren

Kennith Warren of W E Aubuchon Co, Inc.(retired)

Allenstown, NH

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I started working for Aubuchon Hardware just out of High School (1975). When hired Mr William Aubuchon  said his number one goal was to promote from within and make sure I have over a million dollars in my retirement fund. I was very impressed with his statement about his goal for me. He said I will give you all the tools, you just need to act on them and do not delay.

Aubuchon's has been dealing with Fidelity for many years and I have been working with them for over forty years. When I first started I had very little knowledge about a 401K or it's advantages but after going to my first Fidelity training class I saw the huge pluses, Aubuchon's normally does a training class every year for new hires and managers to go and learn more about the plan. On the day of the class I signed up for the max of matching funds which at the time was 4%, and every year on my anniversary went up another 2%. (The company raised the match to 6% but with a reduced percentage match on 5 & 6 so that it equaled for every 6% I did they did 5% matching). Where else can you get free money from your boss for putting away for your own families future. In retail most people know it's not the highest paying job and most people think you will never get rich working in retail for someone else, I tell all of my employees about when I was hired and what Bill Aubuchon said to me.How that if you commit to it you can expect the same results. (Aubuchon's now has when hired, all new employees are entered automatically in to the 401K at 1.5% and they have the option to exit out of the program at any time). And I suggest they sign up for a automatic increase every year of two percent, and tell them if it hurts too much back it down one percent. Set it up for the time yearly raises are given out so you won't even miss it.

 The tax benefits are on so many levels, I get pretty excited when I'm talking with new employees about this huge benefit.


First, you have less taxes taken out so your take home check does not go down by the full percentage that you have taken out. All money put in to the 401K is yours and is never owned by Aubuchon's, so if you leave the company you will be contacted with options on what to do with the funds. I always say if you do leave this is your starting nest egg for retirement, don't spend it thinking it's found money.

Second, all that money put in to your 401K is tax deferred so when you retire you will get taxed on what you withdraw each year (not the full amount).

Third, you have the magic of compounded interest , it's that secret ingredient that most people don't think about. Depending on what you get for interest it will double about every seven years (with a 8% return).

Fourth,  when filling taxes most years you get a added bonus form Uncle Sam for planning for your own retirement so that you may get a larger tax return ( or pay less). Always a nice tax benefit to see

Fifth , As you are adding to your account on a weekly basis you are buying under a dollar cost averaging so sometimes your buying at a low and sometimes it's at a high, but over the long haul your always buying more shares. I have had some employees get nervous and come talk with me about the market going down. I normally can calm them down by saying when it goes down the next pay check will buy you more shares in your account, don't look at the dollars look at how many shares you own. And also say this is for your future which is years down the road. Look at the stock market over years and not days or months.

Six, you are not in this alone if you have questions Fidelity has a toll free number and they can guide you along the way. With all the plan options I tell them they can go on auto pilot and pick a year plan (2030,2040,2050) and depending on how far out you pick the plan adjusts every year for you as you get closer to your plan date. I also tell them they can go on line and read up on the many options if they want to be more educated about stocks and bonds and why it's important to keep a balanced portfolio. 

Seven, we cannot plan on Social Security giving us enough to live on in our golden years and this planning now will give you lots of freedom in your retirement. I also say do you ever hear anyone retired say "I saved too much for retirement" ?

Finally I tell them that what Bill Aubuchon said to me when I first started did come true !