7 Strategies to Maximize 401(k) Savings in 2025

August

7 Strategies to Maximize 401(k) Savings in 2025

August 11, 2025

Whether you are planning to retire in 2 years or 20, you should be looking for ways to maximize 401(k) savings.

Many Americans do not have nearly enough to retire, according to recent reports.

According to the Retirement Income Institute and Alliance for Lifetime Income, “Thirty million Americans are expected to retire between 2024 and 2030.”¹

Of those, “More than half (52.5%) will have to rely primarily on Social Security as their primary source of income, while another 14.6% will strain to meet their financial needs.”²

A major factor behind this retirement income gap? People are not contributing enough to their 401(k)s.

For example, Northwestern Mutual recently reported that for Americans to retire comfortably in 2025, they will need $1.26 million.³

“However, among Americans who have retirement savings, one in four (25%) say they have just one year or less of their current annual income put aside for it.”⁴

Vanguard’s 2025 How America Saves report found “In 2024, the average account balance for Vanguard participants was $148,153; the median balance was $38,176.”⁵

This is significantly less than the $1.26 million that may be necessary.

Whether you will retire by 2030 or still have a while to go, we believe it is important to do all you can to maximize 401(k) savings to put yourself in a better position to retire comfortably.

Here are 7 strategies that may help you maximize 401(k) savings in 2025.

#1 Make Retirement a Priority

maximize 401(k) savings

If you want to retire comfortably, you should start treating it like a non-negotiable expense – just like rent or your mortgage.

Financial experts often refer to this mindset as “paying yourself first.”

That means contributing to your future before spending money elsewhere.

If you want to maximize 401(k) savings, make retirement savings part of your monthly budget – not an afterthought.

When you get a raise or bonus, resist bumping up your lifestyle, and, instead, increase your contribution percentage.

To make saving even easier, consider enabling automatic escalation, which gradually increases your contributions each year without requiring you to lift a finger.

#2 Contribute the Max

maximize 401(k) savings

Look for opportunities to keep maximizing your contributions.

Try your best to contribute the maximum amount allowed each year.

The 401(k) contribution limit for 2025 is $23,500.

Those 50+ are allowed to contribute an additional $7,500, bringing their contribution limit to $31,000.

Throughout the year, any time you receive “extra” money, such as a tax refund or bonus, put this money toward reaching the 401(k) maximum rather than spending it.

#3 Start Rebalancing Quarterly

maximize 401(k) savings

One of the best ways to maximize 401(k) savings is to rebalance your 401(k) portfolio.

Many people set up their 401(k)s and leave them alone.

In our opinion, this is a mistake.

The initial investments you made may not be the best ones for today.

By rebalancing quarterly, you buy or sell assets to maintain the desired level of asset allocation.

#4 Go beyond Target Date Funds

maximize 401(k) savings

Vanguard’s How America Saves 2025 Report found that “Eighty-four percent of all participants used target-date funds,” which is higher than the previous year.⁶

Many employers automatically enroll employees in target date funds.

Target date funds are based on an investor’s expected retirement date, but other key factors, such as location, profession, salary, risk tolerance, goals, and objectives, are not always considered.

While convenient and easy, it is not always the best way to maximize 401(k) savings.

If you are enrolled in a target date fund, it may be time to make a switch.

#5 Get Engaged with Investments

maximize 401(k) savings

The key to maximizing 401(k) savings is to keep it personal.

With target date funds, personal details aren’t typically considered, which is why it may not be the best option for your unique situation.

From our experience, choosing to set it and forget it is not the best approach when it comes to your 401(k) savings.

Instead, we recommend you get engaged and stay engaged.

It is important to know what is happening with your money.

Read your 401(k) statements. Take time to watch this video to learn how.
Ask questions if you don’t know something. Review some of our most frequently asked questions and answers, and reach out if you need more information.

Review and rebalance your investments. As you review your 401(k) statements, ask yourself if the investments you have are working for you.

#6 Leverage the Employee Match

maximize 401(k) savings

One of the easiest ways to maximize 401(k) savings is to leverage the employee match.

You can consider it free money.

As long as you contribute enough to earn the company match, you get extra money in your 401(k)!

For example, if your company matches 100% up to 6% of your pay, and you make $40,000 a year, you could put in $2,400 (or 6%) for the year, and your company would match this 100%.

That’s $2,400 extra money in your 401(k).

#7 Seek Help

maximize 401(k) savings

Try not to wait until it’s too late – ask for help reaching your retirement goals.

It can be beneficial to seek help from a professional who can help you come up with a strategy.

For example, a fiduciary advisor can help you create a plan to maximize 401(k) savings.

401(k) Maneuver provides independent, professional account management with the goal to help employees, just like you, grow and protect their 401(k) accounts.

Our goal is to increase your account performance over time, manage downside risk to minimize losses, and reduce fees that are hurting your retirement account performance.

401(k) Maneuver allows you to go about your life doing what you love with confidence, knowing we are handling the changes for you.

If you have questions about your 401(k) or if you need help, we’re here for you. Click below to book a complimentary 15-minute 401(k) Strategy Session.

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