Key Takeaways
Maxing out your 401(k) typically requires a high savings rate, but building up gradually can help you get there.Strategic moments like raises or job changes offer opportunities to boost contributions without hurting your budget.Hitting income milestones—like $150,000—can make maxing out your retirement savings far more realistic.

Only about 14% of Americans contribute the maximum to their 401(k) each year, according to Vanguard’s How America Saves report.

That number might sound discouraging, but it doesn’t mean the rest of us can’t get there. In fact, most people who do eventually hit the limit—$23,500 for people under 50 in 2025—don’t do so all at once. Instead, they work their way up through small, consistent increases timed with raises, career growth, and shifting financial priorities.

With the median salary in the United States at about $62,000, Michael Hunsberger, a financial planner and founder of Next Mission Financial Planning, notes that even if you’re making $100,000, you’d need to contribute 23.5% of your income to max out your 401(k). “It can be done, but it’s definitely not easy,” he said. Still, the payoff can be huge: more savings, bigger tax advantages, and a lifestyle that prepares you for a less expensive retirement.

Why Only 14% Contribute the Max to Their 401(k)

The short answer? Most people simply don’t make enough.

“Let’s say someone makes $80,000,” said advisor Dwayne Reinike, founder of Valiant Financial Planning. “To max out their 401(k), they would have to contribute over 28% of their income.”

That’s a tall order, especially when you’re also juggling housing costs, student loans, and family expenses. And even high earners can be limited: Some want to max out but are considered highly compensated employees and are limited due to IRS requirements, according to Reinike.

Instead of focusing on hitting the maximum right away, advisors often recommend starting with a smaller savings rate and building up slowly.

“It can be more useful to look at the percentage of income you’re contributing and try to increase that regularly,” Hunsberger said.

Important

For 2025, $23,500 is the 401(k) contribution limit for people under age 50. In 2026, it’s $24,500. Those age 50 and older can make catch-up contributions which increases their limit. And people age 60, 61, 62, and 63 can contribute even more. The contribution limits typically increase every calendar year.

How to Time Your Increases With Raises and Life Changes

One of the best strategies is to increase your contributions when you get a raise or a new job.

“Even if you get a small cost-of-living increase, you should consider increasing the percentage you withhold,” Hunsberger said. “You’re not used to living on the raise, so you’re not going to miss it.”

Reinike agrees. “If someone gets a raise, that’s a great time to put some of that new income toward retirement.” Starting a new job? “That’s another golden opportunity,” he said. Begin maxing out “right away,” before your lifestyle adjusts to the higher pay, he suggests.

Automation can also help you stay on track.

“For someone who has a hard time increasing their contributions, I advise them to set up their 401(k) to automatically increase every year by a certain amount,” Reinike said.

If someone typically gets a pay raise of 3%, then they could afford to increase their 401(k) contributions by 1% or 2%, and they’ll hardly notice the increase, he adds.

The Income Milestones Where Maxing Out Becomes Realistic

While savings habits matter, advisors agree that income plays the biggest role.

If you’re looking to save 15% of your income—a realistic target, according to advisors—you’d need to earn almost $157,000 to max out your 401(k), according to Hunsberger. For workers age 50 or older, who can contribute up to $31,000 with catch-up contributions, the required income level jumps to more than $206,000.

Reinike points to a simpler target: “If someone is making over $235,000 per year, then they should be able to max out their 401(k). That would be 10% of their income.”

Regardless of where you start, consistency is key. And as you earn more and get more financially stable, it makes sense to increase your contributions, according to Justin Pritchard, founder of Approach Financial.

The Bottom Line

Maxing out your 401(k) isn’t just for the ultrarich—it’s a long-term goal that many Americans can reach by steadily increasing their savings. If your income grows or your financial priorities shift, you may find yourself with the flexibility to do more than you expected.

“Saving anything is better than saving nothing,” Pritchard said. “It’s almost always the right move to contribute at least enough to get a full match from your employer.”