Today I read a post on TheSimpleDollar about "The Different Meanings of Saving for Retirement" which really got me thinking. Since my plans are to "retire" by 40 and live off of passive income things might need to change. For 2011 I maxed out my 401k and my roth ira and still got to start my brokerage account off. I'm currently planning on maxing out both yet again this year but I'm not so sure now. My 401k withholding is at 16% right now which would max me out for sure if I stay as busy as I was last year but it's not looking too good right now. Hopefully the E&P work here will pick back up.
What I'm thinking is possibly dropping my 401k contribution to 10% or lower but at least 6% so I can get the full employer match. With a 10% contribution on my part and the 5% match and 4% profit sharing I would essentially be saving 19% of my pay for retirement compared to the 24% that I averaged for 2011. I think dropping it to 10% is probably the way to go because that will give me almost an extra $200 post tax to my paycheck. That would be an extra $4,800 to save throughout the year for my FI brokerage account. The money would first be used to pay off my debt and would allow me to pay it off one month earlier. I think since my ultimate goal is to retire early this is the best route to go especially since I can still save 19% in my 401k, it's just strange to think of since everything you hear is to max out your 401k and roth. What do you think about it? Should I cut the 401k contribution to 10%?