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Wealth column: How to boost 401k contributions without busting your paycheck

We know you've probably heard this but it's worth repeating, one of the best ways to increase your retirement savings is to max out your 401(k) or 403(b) contributions while you're working. By putting money into a Roth or traditional 401(k) or 403(b), you're investing income that can now grow and help you to have a long, successful retirement.

However, in 2019, maxing out one of these accounts means contributing $19,000 if you're under the age of 50 and $25,000 if you're over 50. But that's a lot of money to cut out of your paycheck, especially if you're used to contributing far less than that on an annual basis. The good news? There are ways to add a significant amount of income to your 401(k) without losing a single dollar from the paycheck you receive right now.

Roll in Irregular Income

One of the easiest ways to save more in your retirement accounts without giving up any of your regular income to is put any money you earn outside of your regular paycheck.

For example, if you are a sales manager who gets a quarterly bonus for meeting your sales goal, by putting that bonus income directly into your 401(k) or 403(b), you're not taking away from the money you need for daily life expense but you're one step closer to maxing out your retirement account contributions.

Not all of us get a bonus, however, but there are still ways you can put money away for retirement without sacrificing anything today. One common source of irregular income is a tax return. If you pay more than you need to during the year as a part of your tax withholding, putting that refund into your 401(k) or 403(b) can mean be a great way to contribute more to your retirement plan without taking necessary income out of your wallet.

Increase Contribution after Getting a Raise

Many companies give out cost of living or inflationary raises at a specific time each year. While those extra funds are always welcome, if you can still live comfortably on the income you brought in last year, putting away an extra 2-3 percent can make a big difference in your retirement savings. By aligning an annual increase in your contributions with the small raise you regularly receive, you can put away a meaningful amount of extra cash within a short period of time.

Consider Tax-Deferred Options

If you're someone who is currently using a Roth option, but are at or near the height of their careers, consider switching to a traditional 401(k) or 403(b). By deferring the tax on your income until you withdraw it, you can choose to take that money out if you're at a lower bracket. And because you're now putting money away before you pay tax on it, in order to keep your take-home income the same, you can put away a bigger portion of your income in your retirement savings plan.

All of these options require careful planning and the amount you put away will vary depending on your lifestyle needs, current savings and more. We recommend talking with an experienced financial or tax adviser before making any changes to your retirement savings contributions.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.