How to Get the Most Out of Your 401(k) Company Match

You'll regret leaving this free money on the table.

By Kailey Hagen – Updated Dec 3, 2024 at 4:40 PM

Key Points

A 401(k) match involves employer contributions, often up to 6% of your salary.
You can contribute up to $23,000 to your 401(k) in 2024 ($23,500 in 2025), more if over 50.
Understand your 401(k)'s vesting schedule to fully benefit from matches.

Many companies offer a 401(k) to their employees, and a lot of them also offer company matching as an extra incentive. A 401(k) company match is money your employer contributes to your retirement account, usually based on your own contributions and capped at a certain percentage of your income.

Here's a closer look at how 401(k) company matching works and how much you and your employer are able to contribute to your 401(k) each year.

Loading paragraph...

Businessman handing over money — Image source: Getty Images.

Loading image...

Loading paragraph...

Most people don't have to worry about running into these contribution limits, but high earners should be mindful of them. If your company provides a dollar-for-dollar match on up to 6% of your salary and you earn $400,000 per year, you may not be able to claim the full match because that would require you to set aside $24,000, which is more than you're allowed to contribute to your 401(k) in 2024 or 2025 if you're younger than 50.

Loading paragraph...

Related Retirement Topics

Loading paragraph...

401(k) to Roth IRA Conversion

Looking to turn your 401(k) into a Roth IRA? Here's how and why it's a good idea.

401(k) Vesting: How It Works

How long until you fully own the funds in your 401(k)? That's where vesting comes in.

How Does an IRA Work?

All IRAs aren't created equal. Here's the nitty-gritty.

Full Retirement Age for Getting Social Security

When can you retire and collect Social Security? It depends on when you were born.

Loading hub_pages...

Loading paragraph...

About the Author

Kailey Hagen, CFP, is a contributing Motley Fool retirement analyst covering Social Security, Medicare, and retirement planning. Before The Motley Fool, Kailey was a research analyst for Reviews.com focusing on credit and banking products. She is a Certified Financial Planner® and holds a bachelor’s degree in English from the University of Wisconsin-Madison.

TMFKailey

The Motley Fool has a disclosure policy.