Maximize Your Retirement in Celebration of National 401(k) Day

By Daniel Tatomir, AIF? , Vice President of Retirement Plan Advisors at Fragasso Financial Advisors

National 401(k) Day is celebrated annually on the Friday after Labor Day, this year it is September 6, 2024. The idea behind our most financially responsible national holiday is to promote awareness of retirement savings and to remind us to check in on our own readiness for retirement.

How to Celebrate 401(k) Day:

• If you aren’t currently enrolled in your employer’s plan – start today!
• If you’re already enrolled, consider increasing your contributions. An additional 1% or 2% might seem like a small amount today but it can make a big difference in retirement.
• If your employer offers a matching contribution, make sure you’re contributing at least enough to get the full match.

Benefits of a 401(k):

• Convenience – The amount you choose to save is automatically sent to your 401(k) every payday. This forced discipline makes saving easy and consistent over time.
• Tax Benefits – you can save on taxes by using the plan and keep more of your hard-earned money to enjoy in retirement. Pre-tax and Roth contributions could be available in your plan – the difference is when you enjoy the tax break.
• Compounding – this is simply the concept of your money making more money over time. Your contributions grow, and your previous growth also can continue to grow. Small investments can turn into large account balances and the sooner you start saving, the more powerful the impact compounding can have on your retirement income.

401(k) Review:

It’s important to review your 401(k) periodically to ensure you’re on the path to meet your retirement goals. Here are a few things to consider:

• Retirement Goals – think about what retirement looks like for you, do you want to travel the world or is spending more time with family and grandkids your idea of retirement? Whatever your goal, it’s important to have a plan and make sure you’re saving and investing accordingly.
• Evaluate Your Progress – are you on track to meet your goals? Plan provider websites often have tools to help gauge progress. If you work with a financial advisor or if your retirement plan has an advisor, reach out to them.
• Designate Your Beneficiaries – Who inherits a 401(k) is a critical detail often overlooked. Make sure to designate your beneficiaries and update them due to important life events.

Fragasso’s Retirement Plan Advisors work with businesses, organizations, foundations and trade groups to provide defined contribution, defined benefit, endowment and non-qualified strategies to help build and maintain effective retirement programs. Our dynamic approach includes a centralized portfolio management team and a coordinated investment strategy with one point of contact.

Take advantage of our complimentary consultation. We can help identify possible changes in your current situation to better prepare for the future.