1 No-Brainer Retirement Savings Move That You'll Thank Yourself for Later

Source The Motley Fool

There are some smart moves you can make to put yourself in a position to have a financially secure retirement. Opening an IRA is one example, and maintaining an age-appropriate asset allocation in your investment portfolio is another. Outside of investing, moves like paying your home off before retirement, or getting rid of other debts, can go a long way toward financial security.

However, one extremely valuable move involves employer-sponsored retirement plans like 401(k)s. In many cases, employers will match your contributions up to a certain percentage of your compensation. But far too many people don't take advantage. One wide-scale analysis found that one-fourth of retirement plan participants miss out on the full company match simply because they don't contribute enough.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. See the 10 stocks »

Man working from home.

Image source: Getty Images.

Why your 401(k) match should be a big priority

Consider this simplified example. Let's say that you earn $75,000 per year, and your employer is willing to match all of your contributions, dollar-for-dollar, up to 6% of your salary.

This means that if you take full advantage and contribute 6% of your salary, or $4,500, you will see double that amount, or $9,000 deposited into your account. Assuming this contribution rate for 35 years, you'd end up with a $1.7 million nest egg, compared with about $850,000 without the match. While you probably won't earn the exact same salary every year, you get the idea -- the employer match can make a big difference when it comes to your financial comfort in retirement.

On the other hand, let's say that you only decide to contribute 4% to your 401(k) to make your paychecks higher. This would add a total of $1,500 back into your paychecks (and to your taxable income) but would result in $3,000 less flowing into your 401(k). Not only that, but your retirement nest egg would be about a half-million dollars less in 35 years, compared to if you had taken full advantage.

The $22,924 Social Security bonus most retirees completely overlook

If you're like most Americans, you're a few years (or more) behind on your retirement savings. But a handful of little-known "Social Security secrets" could help ensure a boost in your retirement income. For example: one easy trick could pay you as much as $22,924 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Simply click here to discover how to learn more about these strategies.

View the "Social Security secrets" »

The Motley Fool has a disclosure policy.

Disclaimer: For information purposes only. Past performance is not indicative of future results.
placeholder
What Crypto Whales are Buying For May 2025Crypto whales are making bold moves heading into May 2025, and three tokens are standing out: Ethereum (ETH), Artificial Superintelligence Alliance (FET), and Onyxcoin (XCN).
Author  Beincrypto
Apr 21, Mon
Crypto whales are making bold moves heading into May 2025, and three tokens are standing out: Ethereum (ETH), Artificial Superintelligence Alliance (FET), and Onyxcoin (XCN).
placeholder
Gold price snaps selling off after fresh Trump comments on tariffsGold price (XAU/USD) is turning positive, recovering above the $$3,300 level at the time of writing on Thursday after two days of firm selling pressure since it topped at $3,500 on Tuesday.
Author  FXStreet
Apr 24, Thu
Gold price (XAU/USD) is turning positive, recovering above the $$3,300 level at the time of writing on Thursday after two days of firm selling pressure since it topped at $3,500 on Tuesday.
placeholder
Gold price surges past $3,300 on trade jitters, yield slump reviving haven demandGold price snapped two days of losses on Thursday and rose $50, or more than 1.50%, amid renewed concerns about the US-China trade war.
Author  FXStreet
Yesterday 03: 51
Gold price snapped two days of losses on Thursday and rose $50, or more than 1.50%, amid renewed concerns about the US-China trade war.
placeholder
Gold price consolidates in a range; bulls have the upper hand while above $3,300Gold price (XAU/USD) struggles to capitalize on the previous day's move higher and oscillates in a narrow trading band during the Asian session on Friday amid mixed fundamental cues.
Author  FXStreet
Yesterday 03: 53
Gold price (XAU/USD) struggles to capitalize on the previous day's move higher and oscillates in a narrow trading band during the Asian session on Friday amid mixed fundamental cues.
placeholder
Gold edges down amid clash over status of US-China trade talksGold price is on the back foot on Friday, almost erasing all of Thursday’s gains, and looks set to close off this week in the red.
Author  FXStreet
20 hours ago
Gold price is on the back foot on Friday, almost erasing all of Thursday’s gains, and looks set to close off this week in the red.
goTop
quote