Two coworkers are both saving for retirement. One puts in a little from every paycheck and gets the full company match all year. The other makes a big push early, then stops—and misses match dollars later. Which path feels closer to yours?
Starting in 2025, you can put up to $23,500 from your paychecks into your 401(k). If you’re 50 or older, you can add a $7,500 “catch-up” (total $31,000). If you’re age 60–63, a newer rule (SECURE 2.0) lets you add an even larger catch-up—$11,250 (total $34,750). (1)
Those are big numbers—but the real question is: how will you reach them? Are your contributions set up to collect your company’s match all year? Are you letting your regular paychecks do the heavy lifting instead of trying to time the market?
The Building Blocks
1) Know the limits (and what they unlock)
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$23,500 is the 2025 employee limit.
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50 or older: add $7,500 more (total $31,000).
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Ages 60–63: add $11,250 (total $34,750). (1)
What that looks like per paycheck
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Paid 24 times/year (twice a month)
• $23,500 ≈ $979 per paycheck
• $31,000 (50+) ≈ $1,292 per paycheck
• $34,750 (60–63) ≈ $1,448 per paycheck
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Paid 26 times/year (every two weeks)
• $23,500 ≈ $904 per paycheck
• $31,000 (50+) ≈ $1,192 per paycheck
• $34,750 (60–63) ≈ $1,337 per paycheck
Helpful notes
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These limits are for your contributions. Any company match is on top of these amounts.
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Numbers are for 2025 and can change in future years. (1)
2) Dollar-cost averaging: the “every-paycheck” habit
Putting in the same amount each paycheck buys more shares when prices dip and fewer when they rise. You don’t have to guess the “right time.” Your steady schedule does the work for you.
3) Consistency beats intensity
A rate you can stick with usually wins over stop-and-go bursts. A simple way to grow your savings without feeling it as much: turn on an automatic 1% increase each year or when you get a raise.
4) Coordinate with the company match
Some plans calculate the match each paycheck (not just once a year). If you contribute too fast and hit the limit early, you might miss match dollars later. Spreading contributions across the whole year can help you capture every match dollar. (Your plan documents or HR can tell you how your match works.)
5) Make catch-ups automatic
If you’ll be 50+ (or in the 60–63 window) this year, set your contributions so the catch-up starts automatically after you hit the regular limit. That reduces manual adjustments and helps prevent accidental under- or over-funding. (1)
Considerations for Your 401(k)
- Automate contributions from every paycheck.
- Turn on auto-escalation (for example, +1% each year).
- Check your match rules (per-pay vs. annual) before choosing even-spread vs. front-loading.
- Plan for extras: if your plan allows, add one-time boosts from bonuses.
- Do a midyear check to confirm you’re on track for the 2025 limits and any catch-ups. (1)
Bringing It Together
The market moves up and down; your paycheck is steady. That steadiness is your edge. Could a simple, every-paycheck habit help you reach the limit without guesswork? Would a small 1% nudge each year change your long-term results more than trying to time the market?
If you’d like a quick, friendly walkthrough—how to spread contributions, capture your match, and set up catch-ups—schedule a complimentary conversation. We can translate your goal into a clear “$X per paycheck” strategy that fits your pay schedule and age bracket.
Source:
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(1) Internal Revenue Service. “401(k) limit increases to $23,500 for 2025, IRA limit remains $7,000.” IRS, 1 Nov. 2024, updated 8 July 2025, https://www.irs.gov/newsroom/401k-limit-increases-to-23500-for-2025-ira-limit-remains-7000
For more complete information about your 401(k) investment options, call your company’s plan administrator or your financial professional for a prospectus. The prospectuses contain details on investment objectives, risks, fees, and expenses, as well as other information about your plan’s investment options, which you should carefully consider. Please read the prospectuses thoroughly before sending money. This information is being provided only as a general source of information and is not intended to be the primary basis for investment decisions. It should not be construed as advice designed to meet the particular needs of an individual situation. Please seek the guidance of a financial professional regarding your particular financial concerns. Consult with your tax advisor or attorney regarding specific tax issues.
