A 401(k) can be a valuable retirement savings tool, but its utility depends largely upon your decisions. Even the best 401(k) out there won't help you get any closer to retirement if you're not contributing to it. You also need to make sure you're contributing enough and that you've invested in the right things to maximize your profits and minimize your fees.

The sooner you start prioritizing your retirement savings, the easier it will be for you to save enough. Do the three things listed below if you hope to get the most money possible out of your 401(k). 

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1. Choose the right investments

You aren't just setting money aside in a special account. You're investing that money in various assets that will hopefully grow in value over time, helping you earn additional money for retirement. But how quickly your nest egg grows depends on two things: How your investments perform and how much you're paying in fees.

Your employer usually gives you a few pre-selected investment options in a 401(k). You should focus on finding options that offer diversification so if a few of your investments start performing poorly, you have other ones that can pick up the slack. You also want your investments to match your risk tolerance. Investing aggressively makes more sense when you're younger because you may earn larger returns and if you lose money, you have plenty of time to make up for it later. When you get older, you want to invest more conservatively to preserve what you have. A target-date fund is one option to consider because it automatically adjusts your risk tolerance over time based on your chosen retirement year.

Fees can eat into your profits over time, so you should look into any fees associated with your investments. These are often outlined in the prospectus. Try to keep them as low as possible. Index funds -- mutual funds that passively track a market index -- are usually pretty affordable because there's less work for the fund manager, so they pass that savings along to you. If your 401(k) doesn't have any affordable options, talk to your employer to see if it will add any.

2. Contribute as much as you can

You're allowed to contribute up to $19,500 to a 401(k) in 2020. Adults 50 and older may contribute another $6,500 in catch-up contributions. You don't have to max out your 401(k) every year, but doing so will help you achieve your goals more quickly.

If you contribute $5,000 per year to your retirement over 30 years, you'd have about $472,000 with a 7% average annual rate of return. But if you contributed $10,000 per year, you're looking at a much nicer $945,000 with the same average rate of return, and if you contributed the 2020 maximum of $19,500 per year, you'd have over $1.84 million in 30 years. Coupled with Social Security, that could be enough for some people to retire on.

Of course, just because you'd like to max out your retirement contributions every year doesn't mean you'll be able to. You can try reducing your expenses by canceling unused subscriptions and skipping discretionary purchases to give you more cash to put toward retirement, but don't worry too much if you cannot afford to max out your 401(k) right now. Just contribute as much as you are able to and try to increase this amount by a little bit every year, or when you get a raise.

3. Claim your full employer match

Some employers will match employees' contributions to help them earn even more money for retirement. They may do a dollar-for-dollar match or a $0.50-on-the-dollar match up to a certain percentage of your income. Every company is different, so you need to talk to your company's HR department to learn about what, if any, matching system it uses.

Unless you need all of your earnings to cover your essential expenses, you should contribute at least enough to your 401(k) to get your full employer match. It's essentially like getting a bonus, so there's no good reason to turn it down if you can afford to claim it. These matching funds can reduce how much of your personal income you must contribute to retirement, giving you additional cash to spend now.

Stay mindful of your 401(k)'s vesting schedule if you're thinking about leaving the company. This determines when employer-matched funds are yours to keep. Some companies offer immediate vesting, though this is rare. Others may require you to work for the company for a certain number of years before you're allowed to keep any of your employer-matched funds if you leave, while others may release these funds to you gradually. It's best to stick it out until you're fully vested if possible so you don't have to give this money back.

Maximizing your 401(k) is pretty straightforward, though it's not always the easiest thing to do. But if you follow the above three steps to the best of your abilities, you should begin to see a difference in your 401(k) balance before too long.