With a new year underway, it’s a good time to start setting your goals for how much you’ll contribute to your retirement accounts this year. For many people, a workplace 401(k) is the best retirement account to contribute to because it’s easy to invest money in a workplace plan. You can just sign up to make contributions from each paycheck. In many cases, your employer may also match at least part of your contributions.
In 2026, you can invest a maximum of $24,500 if you are 50 or under. If you are 50 or over, you are eligible for an additional $8,000 catch up contribution, bringing the total amount you are allowed to contribute up to $32,500. And, if you are between the ages of 60 and 63, you can invest an extra $11,250 in catch-up contributions instead of an extra $8,000 — which means that you can put a total of $35,750 into your account.
So, if you decided to invest the full amount this year, how much would this turn into after a decade? Let’s take a look.
How much money would you end up with in a decade after maxing out your 401(k) in 2026?
The table below shows the amount of money that you would end up with if you maxed out your 401(k), depending on whether you are eligible for catch-up contributions or not. Since the S&P 500 has pretty consistently produced 10% average annual returns, this assumes that you earned 10% per year on your investments. It also assumes you did not get any employer matching contribution, and that you didn’t make any other investments over the decade that you left your 401(k) funds in the market.
| Investment amount | Amount you’ll have after a decade |
| $24,500 | $63,546.69 |
| $32,500 | $84,296.63 |
| $35,750 | $92,726.29 |
This means that maxing out your contributions in a single year and leaving your money alone for a decade could leave you with a retirement account balance almost as large as the $67,796 median 401(k) balance among Americans ages 45-54. If you were able to make catch-up contributions, you would exceed the median. And this doesn’t even include an employer match.
Your balance grows so quickly here because of compounding.
If you invest $24,500 this year and leave it alone for a decade, your investment will (hopefully) earn returns this year that can be reinvested, so in year two, you get to earn returns on a bigger starting balance. This continues over 10 years, so your money is making money for you, and your balance (ideally) grows more quickly each year. Of course, you may not necessarily earn 10% on your money every year. But if you get that average 10% annual return over the decade, your account balance should be pretty close to these amounts.
Contribute as much to your 401(k) balance as you can
Of course, maxing out your 401(k) balance may not be possible, given that not everyone has $24,500 (or more) to invest this year. But keep in mind that the table above is just one year of maxed-out contributions, and it assumes you put nothing else into your account. If you invest a smaller amount over time but you invest consistently, you can still make compounding work for you and end up with a much bigger nest egg than the typical American retires with.
The key is to invest as much as you can, starting as early as you can, so you have time for the power of compounding to work for you. A financial advisor can help you to create a personalized investing plan that takes your budget and goals into account, so reach out to one if you need help getting started with investing in your 401(k) or optimizing the contributions you make.
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