In addition to earning a higher Social Security benefit (by working longer and delaying benefits), one of the most powerful ways that people can increase their income in retirement is to increase their savings in tax-deferred employer retirement savings plans (e.g., 401(k), 403(b), and TSP). 

Below are four strategies to boost your savings: 

  • Save Until It Hurts: Save as much as you can until saving starts to pinch your cash flow. In 2020, workers under age 50 can defer federal income tax on up to $19,500 in a 401(k) or similar employer tax-deferred retirement savings plan. Workers age 50 and over can contribute up to $26,000 with catch-up contributions.
  • Save Automatically: Sign up to have automatic retirement savings contributions deducted from your salary if you receive a steady paycheck. If your income fluctuates, save as much as you can whenever you can (say, when you receive a higher than average monthly income, a bonus, or an income tax refund).
  • Earn the Maximum Employer Match: Save at least the maximum amount that your employer will match (e.g., 6 percent of salary). This is “free money” that should not be left on the table. A 50 cent match for every dollar saved is an automatic 50 percent return that is risk-free and tax-deferred.
  • Make Wise Investment Choices: Select investments with low expense ratios and good long-term performance for employer plans (and IRAs). Many investors value simplicity and select index funds or exchange-traded funds that track market indices and target-date funds that gradually become more conservative over time and hold less stock.


America Saves Week 2020 is February 24–29. Consider it a challenge to increase your retirement nest egg. Every small step matters.