The Low-Risk Way to Get Up to a 100% Return on Your 401(k) Contributions

If you just see retirement planning as saving money for the future, you're missing an important piece of the puzzle. You also need to be strategic about what you do with your savings to help your money grow as quickly as possible.

Most people turn to investing to help them increase their wealth. The average stock market return has been about 10% per year over the last 50 years, so this is a good strategy. But there may be another, much faster way to grow your 401(k) that could help you double your annual contributions year after year.

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How to double your 401(k) contributions quickly

You probably already know how your company's 401(k) plan works: You defer money from your paychecks, and you invest it in target-date funds or other funds your plan offers. Then, you leave the money alone until you're ready to spend it.

For companies that offer a 401(k) match, there's an extra element. Putting money into your account triggers your employer to make an additional contribution to your retirement savings. How much you get depends on your income and your company's matching formula.

The best matches give you a dollar for every dollar you set aside, up to a certain percentage of your income. This could potentially double your retirement account contributions in a given year. Some companies only give you $0.50 for every dollar you contribute, but a 50% boost is still a substantial amount.

Once your 401(k) match is in your account, it's invested just like your own contributions, so it grows over time at the same rate as the rest of your portfolio. It could wind up being worth a lot by retirement, especially if you claim it year after year.

For example, say you earn $60,000 per year and you qualify for a 100% match on up to 4% of your income. So you put $2,400 into your account and your employer does the same. If you earn a 10% average annual return on that money over 20 years, your total balance, with the help of your employer match, would be nearly $275,000. However, without your employer match, your balance would only be about $137,000.

That wouldn't be enough to retire on. But you can see how you're able to reach your savings goals much more quickly when you have a match on your side than when you have to save all on your own.

How to claim your 401(k) match

You don't have to do anything special to claim your 401(k) match. If your company offers one, it should automatically contribute the match when you make your own contributions. So the only thing you have to worry about is finding the cash to spare.

That's easier said than done, of course. But if you can afford to defer any money to your 401(k) in 2025, there's still time to grab at least some of your match before the end of the year.

First, figure out how your company's 401(k) matching formula works. Your online 401(k) account may have this information, or you can always ask your HR department. Then, subtract any amount you've already contributed to your 401(k) during 2025 to figure out how much of your match remains unclaimed.

Divide this by the number of pay periods left in the year to figure out how much you have to set aside to get the full match. If you can't afford to save that much, then just set aside what you can.

It's not too early to start planning for next year, either. If you begin saving right away in January, you stand a better chance of claiming the full match by the end of 2026.

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