ADVICE YOU CAN USE
Maximizing Your 401(k) Benefits
A guide for Gerken employees.
Eligible employees of The Gerken Companies have access to a valuable retirement savings tool: the company 401(k) plan. Understanding how to use this benefit to its fullest potential is essential for securing your financial future, regardless of where you are in your career. Let’s explore the key strategies to help you make the most of your 401(k) at every stage.
Start Early and Automate Your Savings
For those in their 20s and 30s, the best strategy is to start early and make saving automatic. When contributions come directly from your paycheck, saving becomes easier and less daunting. Choose a contribution rate that aligns with your lifestyle, and consider increasing it whenever you receive a raise. Even a modest increase can significantly enhance your savings over time, thanks to the power of compound interest.
Take Advantage of Catch-Up Contributions
If you’re in your 40s or 50s, it’s crucial to evaluate your savings strategy regularly. As of 2026, you can contribute up to $24,500 to your 401(k), with an additional catch-up contribution of $8,000 available when you turn 50. This enhancement can greatly bolster your retirement savings. Regularly reviewing your contribution rate and investment elections will help ensure you’re making the most of the benefits available to you.
Enhanced Catch-Up for Those Approaching Retirement
For employees aged 60 to 63, a 401(k) offers an enhanced catch-up opportunity. If you turn 60, 61, 62, or 63 in 2026, you can contribute up to $11,250 in catch-up contributions. This brings your total contribution to $35,750 for the year, providing an excellent way to accelerate your savings as retirement approaches. Note that some employees with high prior-year wages will need to make catch-up contributions as Roth contributions, so be sure to review your plan materials for these details.
Transition from Saving to Strategy
As you near retirement, your approach should shift from merely saving to developing a comprehensive withdrawal strategy. Consider how your 401(k) fits into your overall financial picture alongside Social Security, healthcare costs, and other income streams. Proper planning will help you create a coordinated retirement paycheck that supports your desired lifestyle.
Remember: Progress Over Perfection
Throughout your career, the most important factor is to consistently contribute to your 401(k) and incrementally ramp up your contributions as you’re able. At The Gerken Companies, we encourage you to view your 401(k) not just as a savings vehicle but as the cornerstone of your retirement strategy. This vital resource will support the life you envision for yourself and your loved ones.
Building a secure retirement doesn’t happen overnight. By taking deliberate and informed steps with your 401(k), you will lay the groundwork for a comfortable future. Make the most of your benefits today to ensure a brighter tomorrow.
If you have questions or need further assistance, don’t hesitate to reach out to Human Resources or your personal financial advisor.
