Never skip the employer 401(k) match

What a match actually is

A common formula is 50% or 100% of the first 3-6% of pay you defer. Contribute 6% to a 100% match on 6% and the employer adds another 6% of pay before markets move. That is why max-the-match shows up first in every honest order of operations, including the 401(k) vs IRA vs Roth guide.

• Employee deferrals (traditional or Roth 401(k)) count toward the annual employee limit.
• Employer match generally does not count toward that employee limit; it counts toward the higher overall additions cap.
• Read the summary plan description for vesting, true-up, and whether after-tax / mega-backdoor exists.

Vesting and true-up are the two footnotes that matter

Cliff or graded vesting means the match is not fully yours on day one. If you will change jobs this year, still capture what you will keep.

True-up: some employers reconcile at year-end so front-loading does not strand later paychecks. If there is no true-up, spread deferrals across the year so every paycheck is match-eligible.

Limits change. Confirm the current IRS employee deferral and overall 415(c) caps before you set a dollar goal.

After the match: debt and cash before heroics

Unmatched 401(k) dollars compete with a 22% card and a $0 cash buffer. Usually the card and a starter HYSA win. Then come IRA / HSA decisions.

FAQ

Should I pause my 401(k) to pay off credit cards?

Pause only the unmatched dollars. Contribute enough to capture the full employer match, then send surplus to high-APR cards.

What if I leave before I vest?

Your deferrals are yours. Unvested match can be forfeited. Read the schedule before you treat the match as cash you will keep.

Does a true-up mean I can wait until December?

Only if the plan true-ups. Many do not. Spreading contributions is the safe default.