If you have a 401(k) through your employer, you have a good way to prepare for retirement. It is even better if your employer is giving you matching contributions. This fact alone can make investing in a 401(k) a worthwhile investment. Still, there are some things you need to think about before maxing out your 401k contributions every year.
The Positive Aspects of Having a 401(k)
- Its Convenience
- Its Potential
A 401(k), on the other hand, enables you to contribute up to $20,500 in 2022 to a single employer’s plan. You can put an equal amount into a separate 401(k) through non-elective contributions. The Internal Revenue Service (IRS) says that owners of these accounts benefit from the cost-of-living adjustments, two of which have occurred since 2019.