It is time for your annual 401(k) Plan Account Review…
Regularly reviewing your 401(k) plan investments and contributions is crucial to ensure that your retirement savings are on track and aligned with your financial goals. This includes checking your contributions amounts, company match if available, investment options, and named beneficiaries associated with your account.
Benefits of Regular Reviews:
- Stay Aligned with Goals: Regular reviews help ensure that your 401(k) plan remains aligned with your long-term financial goals.
- Optimize Performance: By monitoring performance and making adjustments, you can optimize your investment returns and manage risks.
- Maximize Contributions: Regularly checking contribution levels helps you maximize your savings and take full advantage of tax benefits and employer matches.
- Adapt to Changes: Life and market changes can impact your financial situation. Regular reviews allow you to adapt your strategy accordingly.
Frequency of Reviewing Your 401(k) Plan Account:
- Annually: At a minimum, you should review your 401(k) plan once a year. This annual review allows you to assess your investment performance, contribution levels, and overall retirement strategy.
- After Major Life Events: Significant life changes such as marriage, divorce, the birth of a child, or a new job should prompt a review of your 401(k) plan. These events can impact your financial situation and retirement goals.
- Approaching Retirement: As you approach your planned retirement date, you should review your 401(k) plan with your financial advisor to discuss future income needs and next steps for when you leave your company.
It is also important to note that the IRS updates the contribution limits for 401(k) plans annually to account for inflation and other economic factors. These limits are set to help individuals save more for retirement while providing certain tax advantages.
For the year 2024, the new 401(k) contribution limits are as follows:
Contribution Type | 2024 Limit |
Employee Contribution | $23,000 |
Catch-Up Contribution (Age 50+) | $7,500 |
Total Contribution (Employee + Employer) | $69,000 |
By staying informed about the new limits and adjusting your contributions accordingly, you can better prepare for a financially secure retirement. If you would like to discuss how to conduct a proper account review, please reach out to us today.
Daniel N. Cocco, CPFA®, AIF®
Certified Plan Fiduciary Advisor
Accredited Investment Fiduciary
Beacon Wealth Partners
This article is being provided for informational purposes and should not be construed as investment advice or relied upon as a basis for any investment or financial decision.
Duly-registered and duly-licensed representatives offer securities through Equitable Advisors, LLC (NY, NY (212) 314-4600), member FINRA, SIPC (Equitable Financial Advisors in MI and TN), offer investment advisory products and services through Equitable Advisors, LLC, an SEC-registered investment advisor, and offer annuity and insurance products through Equitable Network, LLC (Equitable Network Insurance Agency of California, LLC; Equitable Network Insurance Agency of Utah, LLC; Equitable Network of Puerto Rico, Inc.). Beacon Wealth Partners is not owned or operated by Equitable Advisors or Equitable Network and there is no affiliation with Ritholtz Wealth Management. PPG-7219249.1 (10/24)(Exp. 10/28)