How Much Of Paycheck To Put In 401(k)?

Added March 23, 2009 by Ilyce R. Glink

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Summary: If your employer offers matching for your 401(k), it’s wise to invest as much of your paycheck as possible, up to the amount of the match. If you are starting your 401(k) later in life, you should be stocking away as much as possible. The closer you get to retirement, the less time that 401(k) has to grow.

Q: I am just starting a 401(k) with 100 percent matching funds from my employer. I am 45 years old and am wondering what is the best percentage of my paycheck to invest?

A: I don't know how long you're planning to work, but I'd put in as much of your paycheck as you can spare, certainly up to the amount of the match.

Since you're 45, you don't have as many years to have that cash grow. So, more is better.

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