A great thing about a 401(k) is that you can sign up and forget about it. The money you set aside disappears from your paycheck before you get your hands on it.
Although this autopilot approach is relatively painless, don't be lulled into complacency. Keep your eyes open for ways to slip more cash into this tax shelter. If you're not maxed out already, don't overlook these opportunities:
- Maxed out on social security taxes? This 6.2% levy stops when earnings pass $118,500 in 2015. If you cross the threshold, boost your contributions so your 401(k) gets the cash the government used to take.
- Refinanced your mortgage? Sock some of your savings from the lower rate into your 401(k).
- Refinanced your student loans? If you have student loans, check to see if you can consolidate them at a lower rate.
- End-of-year bonus? Ask if you can deposit part of it in your 401(k). Rules vary.
- Are you overwithholding? If you got a tax refund this spring, file a new W-4 form with your employer to cut your withholding. Use our calculator to figure out how much you can add to your paycheck. At the same time, boost your 401(k) contribution by the same amount. Your paycheck won't change, but your retirement security sure will.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
-
Why Taiwan Semiconductor Stock Is Falling After EarningsTaiwan Semiconductor beat expectations for the first quarter but its stock is notably lower. Here's why.
-
Strategies to Optimize Your Social Security BenefitsTo maximize what you can collect, it’s crucial to know when you can file, how delaying filing affects your checks and the income limit if you’re still working.
-
COVID Hospitalization Rates See an Uptick As Winter Looms — The Kiplinger LetterThe Kiplinger Letter A new Omicron booster is available, but the elderly are still at risk and winter is right around the corner.
-
Will Weight-Loss Drugs Spike Medicare Costs?: The Kiplinger LetterEconomic Forecasts Lawmakers are trying to get weight-loss drugs like Wegovy covered by Medicare. Long-term savings are possible, but it could cost the program $27 billion.
-
Greenland, U.S. Plans to Boost Tourist Economy: Kiplinger Economic ForecastsEconomic Forecasts A U.S. congressional effort could see some Canadian visitors get longer stays, meanwhile, Greenland bids to be the next vacation hotspot.
-
Medicare Drug Price Negotiations Latest: Kiplinger Economic ForecastsEconomic Forecasts Medicare drug price negotiations: Early signs have emerged of how these key talks will be handled.
-
Understanding Capital Gains and Lossescapital gains tax What's a capital asset, and how much tax do I have to pay when I sell?
-
Forces That Affect Your Estate Planretirement From probate and ownership division to the taxing arm of Uncle Sam, here are four things that can influence what happens to your belongings.
-
What to Ask Before Buying an Annuity
insurance If more people understood these confusing products, fewer probably would be sold. Find out what you need to know.
-
Tapping Your IRA in Retirementretirement You can cash in your IRA all at once, but doing so could subject you to an enormous tax bill. You'll probably do better tax-wise by taking out as little as necessary each year.
