Personal Finance

After Missing Both My, And My Employers 401(K) Contributions, What Options Exist To Fix My Retirement Situation?

Christy Bieber

Published: March 10, 2025 2:40 pm

Each year, you are allowed to make 401(k) contributions. You can make pre-tax contributions up to the annual contribution limit. If you work for a company that provides matching funds, you’ll also receive some money from your employer when you invest. Companies commonly match around 50% or 100% of worker contributions up to a set percentage of their salary. 

Unfortunately, if you did not make a contribution in a specific year, then you’ve missed out on the opportunity to invest for that year — and you’ve also missed the chance to earn any matching money that would have been available to you. You cannot, for example, go back and make your 2023 401(k) contribution in 2025. 

So, what should you do if you missed out on investing money in your 401(k) in the past? How can you get back on track?

Here’s how to build a secure retirement after missing 401(k) contributions

If you missed out on past 401(k) contributions, you’ve definitely made it a little harder to invest for retirement. Not only do you have tax breaks you didn’t claim and matching funds left on the table, but you’ve also missed out on the compound interest your contributions would have earned.

The good news is, the best way to get back on track is to stop making that mistake going forward. You should sign up to contribute to your 401(k) today so you can start working towards growing your nest egg. You can typically sign up by completing just a few forms with your HR Department and once you do, your money should automatically be taken out of your paycheck and invested along with any matching funds. 

You’ll also want to ask about the rules for employer matching contributions so you will know how much your company is going to contribute and also if the money vests right away or if there’s a waiting period. The contributions you make out of your pay always belong to you right away, but some companies require you to be on the job for a certain period of time before contributions vest or become yours to keep.

Once you’ve signed up, the money will come effortlessly out of your paycheck and go into your 401(k) plan. You’ll be able to sign into your account, select investments for your money to go into, and watch your account balance grow. 

How much should you invest in your 401(k)?

There are a couple of simple rules of thumb that give you an idea of how much to invest for retirement. For example, you could aim to contribute about 15% of your income to your account. Or,  you could set a target goal of saving 10 times your final salary in your 401(k) plan by your chosen retirement date, then use the calculators on Investor.gov to help you figure out how much you must contribute each month to get to your goal.

Your best bet, though, is likely going to be to talk with a financial advisor about your options for retirement investing. An advisor can help you decide how much to invest, and also if you should put all your retirement contributions into a 401(k) or invest enough to earn your matching contributions and then diversify into a traditional or Roth IRA.

Getting this professional advice can be invaluable, especially if you feel like you missed out on investing for retirement in the past and want to do things right in the future.