Overview
- Automatic payroll deductions in 401(k)s help keep contributions consistent without extra effort from savers.
- Capturing the full employer match prevents forfeiting immediate dollars and decades of compounded growth.
- Many plans limit investment choices and include higher‑fee funds, so shifting to low‑cost index options can improve long‑term results.
- A Roth 401(k) can offer tax‑free withdrawals in retirement when rules are met, giving savers a different tax‑timing choice.
- If no workplace plan is available, IRAs allow broader investments with 2026 limits of $7,500 under 50 and $8,600 for 50+, and HSAs can serve as a retirement tool with triple tax advantages and funds that never expire.
- New findings show people with 401(k)s hold about 29% more in retirement savings, and 2026 401(k) contribution limits rise to $24,500 plus a $7,500 catch‑up ($11,250 at ages 60–63), with average employer matches around 4.6%.