Are You Missing Out on Your 401(k) Match Without Realizing It?

Bottom Line Up Front

• Contributing too quickly to your 401(k) or changing your contribution rate during the year could cause you to miss out on employer matching dollars if your company matches per paycheck.
• Ask your employer if they offer a year-end “true-up” or pace your contributions.
• Staying aware of plan rules, raises, and contribution limits ensures you don’t leave free retirement money on the table.

When it comes to saving for retirement, a 401(k) employer match might be one of the easiest wins—free money just for contributing to your retirement plan? Yes, please. But what if we told you that you could be accidentally leaving some of it on the table?

Let’s break down what’s really going on with employer matches and how to make sure you’re not unknowingly leaving money on the table.

First, What Is a 401(k) Match?

A 401(k) match is one of the most valuable benefits an employer can offer. Essentially, it’s when your company contributes to your retirement savings based on how much you contribute. For example, your employer might match 25% of the first 6% of your salary that you contribute.

That means if you earn $80,000 a year and contribute 6% of your salary ($4,800), your employer would contribute an additional 25% of that amount — $1,200. That’s an immediate 25% return on your contribution.

So why would anyone turn that down? They probably don’t mean to, but it happens more often than you think.

Learn more: Matching Contribution: What It Is, How It Works, FAQs (Investopedia)

The Hidden Pitfall of Front-Loading Contributions

Some employees, especially high earners or young professionals living at home with low expenses, try to ‘front-load’ their 401(k) contributions. The thought is: contribute as much as possible early in the year, then take a break once they’ve hit the annual limit.

While that strategy can be efficient in some ways, it may backfire when it comes to employer matching.

Here’s why: many employers tie their matching contributions to each paycheck. If you stop contributing mid-year, after reaching the IRS annual limit, your employer may also stop matching. You might have maxed out your personal contribution, but if your employer only matches based on per-paycheck contributions, you could miss out on months of matching dollars.

Real Talk: That’s Money You Could’ve Had

Let’s say you hit the IRS contribution limit by the end of July. Great! But if your employer doesn’t “true-up” your contributions at the end of the year (more on that below), you could be missing five full months of matching funds.

How to Make Sure You’re Getting Every Dollar You Deserve

Avoiding this mistake isn’t complicated, it just takes a little planning. Here’s how to do it:

1. Find out if your employer offers a year-end “true-up”
   
   Some employers run a true-up process at the end of the year. That means they review your total contributions across the year and make up any matching shortfalls, even if you stopped contributing mid-year. If your company does this, great! You’re likely covered.
   
   Action: Contact HR or check your Summary Plan Description (SPD) to see if a true-up is part of your plan design.
   
2. Pace yourself
   
   If your employer doesn’t offer a true-up, you’ll want to time your contributions so they’re spread out over the year. That way, your contribution gets matched with every paycheck.
   
   Pro Tip: Use your payroll calendar to calculate how much to contribute per pay period to hit the annual limit by your final paycheck.
   
3. Monitor changes throughout the year
   
   Raises, bonuses, and other compensation shifts can throw off your contribution pacing. If you receive a bump in pay or a large bonus that’s eligible for 401(k) contributions, reassess your per-paycheck contributions to avoid maxing out to early.
   
4. High Earners: Know Your Options
   
   Some companies offer non-qualified plans to supplement their standard 401(k) offerings, typically for certain employees who exceed plan limits or hold specific roles. These plans allow for additional retirement savings opportunities, though they often come with different rules and considerations.
   
   If you’re in a higher income bracket or leadership position, it’s worth asking whether your company offers a non-qualified plans as part of your overall package.

The Bottom Line

An employer match is essentially free money for your future. But like any benefit, it’s only as valuable as your ability to access it.

By pacing your contributions, understanding your plan’s match structure, and staying proactive throughout the year, you can avoid one of the most common 401(k) mistakes and maximize your retirement savings.