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
Nvidia stock sinks 4% as Trump’s tariff plans rattle AI tradeNvidia shares fell over 4% early Monday after US President Donald Trump delivered a stern message about trade tariffs. Trump said on Sunday that no country would be given any special treatment regarding tariffs. He also signed new trade policies into effect on April 2, which he calls “Liberation Day.” This frightened investors, who had […]
Author  NewsBTC
Apr 01, Tue
Nvidia shares fell over 4% early Monday after US President Donald Trump delivered a stern message about trade tariffs. Trump said on Sunday that no country would be given any special treatment regarding tariffs. He also signed new trade policies into effect on April 2, which he calls “Liberation Day.” This frightened investors, who had […]
placeholder
Bitcoin Price Bounces Back—Can It Finally Break Resistance?Bitcoin price started a recovery wave above the $83,500 zone. BTC is now consolidating and might struggle to settle above the $85,500 zone. Bitcoin started a decent recovery wave above the $83,500
Author  NewsBTC
23 hours ago
Bitcoin price started a recovery wave above the $83,500 zone. BTC is now consolidating and might struggle to settle above the $85,500 zone. Bitcoin started a decent recovery wave above the $83,500
placeholder
Bitcoin Price Struggling but Short-Term Holders Might Be Setting the Stage for $150KBitcoin has recently displayed signs of upward momentum, trading at $85,215, marking a 2.2% increase in just the past day. Despite this short-term gain, the asset remains down by over 21.2% from its
Author  NewsBTC
18 hours ago
Bitcoin has recently displayed signs of upward momentum, trading at $85,215, marking a 2.2% increase in just the past day. Despite this short-term gain, the asset remains down by over 21.2% from its
placeholder
U.S. March Nonfarm Payroll Preview: Even If Data Aligns with Expectations, Financial Markets May Not Escape the Fate of VolatilityOn 4 April 2025, the United States will release its March Nonfarm Payrolls (NFP) data. The market consensus currently anticipates job growth of 128,000, a decline from February’s 151,000 (Figure 1). W
Author  TradingKey
17 hours ago
On 4 April 2025, the United States will release its March Nonfarm Payrolls (NFP) data. The market consensus currently anticipates job growth of 128,000, a decline from February’s 151,000 (Figure 1). W
placeholder
Gold price stabilizes ahead of Trump's tariffs announcement on “Liberation Day”Gold price (XAU/USD) stabilizes just above $3,130 at the time of writing on Wednesday following a mean reversal move the prior day after a fresh all-time high got eked out at $3,149 before closing in negative territory.
Author  FXStreet
16 hours ago
Gold price (XAU/USD) stabilizes just above $3,130 at the time of writing on Wednesday following a mean reversal move the prior day after a fresh all-time high got eked out at $3,149 before closing in negative territory.
goTop
quote