Frequently Asked Questions
What is the 401(k) contribution limit for 2026?
For 2026, the 401(k) employee contribution limit is $23,500. If you are age 50 or older, you can contribute an additional $7,500 catch-up, for a total of $31,000. The SECURE 2.0 Act also introduced a super catch-up of $11,250 for ages 60-63.
How does employer matching work?
Many employers match a percentage of your contributions, typically 50% up to 6% of your salary. For example, if you earn $100,000 and contribute 6%, your employer adds $3,000. This is free money that significantly boosts your retirement savings.
Should I contribute to a 401(k) or Roth IRA first?
A common strategy is: 1) Contribute to your 401(k) up to the employer match (free money), 2) Max out a Roth IRA ($7,000 in 2026), 3) Go back and max out your 401(k). If your employer offers no match, Roth IRA may be preferred due to tax-free withdrawals.
What happens to my 401(k) when I leave my job?
You can leave it in the old plan, roll it to a new employer's 401(k), or roll it into a Traditional IRA. Rolling to an IRA typically gives you more investment options and lower fees. Do NOT cash it out — you'll pay income tax plus a 10% early withdrawal penalty if under 59½.
How much do I need to save for retirement?
A common rule is to save 15% of your gross income for retirement, including employer match. By age 30, aim to have 1x your salary saved; by 40, 3x; by 50, 6x; by 60, 8x; by 67, 10x. Use our calculator to project your specific balance.
What is the 4% rule for retirement withdrawals?
The 4% rule suggests withdrawing 4% of your retirement savings in the first year, then adjusting for inflation. With a $1,000,000 balance, that's $40,000/year or about $3,333/month. Studies show this approach has a high success rate over 30 years.