OPTIMIZE YOUR WORK RETIREMENT PLAN, 401(k), 403(b), 457, ETC

Start with being mindful of your employer’s company match and use that as your floor contribution amount. For example, if your company uses a common safe harbor match of 100% of the first 3% of each employee’s contribution and 50% of the next 2%, this means if you defer 5% of your salary, the company will fund 4% of your pay. Combined you will have 9% of your gross pay being funded for your retirement living expenses. If your cash flow does not allow you to maximize the company match, make it a goal to get there. Consider increasing your contribution rate 1% - 2% per year. Many 401(k) providers allow you to automate this by selecting the auto increase feature.

For 2022 you can contribute up to $20,500. Taxpayers age 50 (at any time during the year) or older can take advantage of the additional catch-up contribution of up to $6,500.