What skipping part of your 401(k) match costs: $720 a year becomes $133,000

"Contribute at least enough to get the full match" is the most common 401(k) advice there is. Here's what it's worth in dollars, for one example saver, from the sample file of our retirement savings planner. Every figure comes from the same year-by-year model, which was checked against an independent calculation. The inputs are examples, not averages: use your own.

The example

• Age 32, retiring at 65 (33 years of saving), $72,000 salary with 3% raises.
• Contributes 4% of salary. The employer matches 50% of contributions, on the first 6% of salary.
• $38,000 saved so far. 6% return a year, 2.5% inflation, 4% withdrawal rate in retirement.
• Contributions and the match are counted at the end of each year, and capped at the 2026 IRS limit ($24,500), which grows with inflation. None of the rates below comes close to it.

This year: $720 left on the table

At 4% of $72,000, the contribution is $2,880 and the match is half of it: $1,440. At 6% the contribution would be $4,320 and the match $2,160. The difference, $720 a year, is money the employer offers and this saver doesn't take. It's paid for by putting in $1,440 more of their own salary before tax.

By 65: contribution rate vs retirement

The employer's total stops growing at 6%: that's where the match ends. Everything above it is the saver's own money and its growth.

What the two missing points cost

Going from 4% to 6% adds $79,312 of the saver's own contributions over 33 years and $39,656 of match. By 65 the balance is $301,554 higher, which is $133,499 in today's dollars, or $5,340 a year more retirement income at a 4% withdrawal rate.

The match makes those two points worth more than any others. Each point of salary between 4% and 6% adds $66,750 (today's dollars) by 65. Each point above 6% adds $44,500. That's exactly 1.5 times as much, because every dollar below the cap brings 50 cents of match with it.

Starting later: the match is worth less by 65, but still worth taking

Same salary, balance and match, only the starting age changes. What moving from 4% to 6% adds by 65:

The match alone won't reach every goal

This saver wants $30,000 a year from savings in today's dollars. That takes $1,694,138 at 65 (in future dollars) at a 4% withdrawal rate. At 4% of salary they'd reach $863,051. The full 6% match isn't enough either: it takes 12% of salary to get there ($31,303 a year). Kept at 4%, working longer doesn't close the gap by age 80.

So the match is the first step, not the whole plan. It's the cheapest money in the table, but the rate that reaches a goal is usually higher.

Checking your own match

1. Find the formula in your plan documents: the match rate (50%, 100%...) and the cap (the share of salary it applies to). Some plans have two tiers, such as 100% on the first 3% and 50% on the next 2%.
2. Your full-match rate is the cap. If you contribute less than that, the missed match is the match rate times the difference, times your salary: here 50% × 2% × $72,000 = $720.
3. Check vesting: match money may only become yours after a number of years with the employer.
4. If your contributions reach the annual limit before December, ask whether your plan does a "true-up". Without one, matching per paycheck can stop early.

To run your own figures now, the free 401(k) match calculator shows the missed match, your income at retirement and the contribution you need. Every figure above is from the sample file of our retirement savings planner and the same year-by-year model, which was checked against an independent calculation. Taxes, fees and Social Security aren't included. It's an illustration, not financial advice.