As 2025 approaches, financial experts encourage workers to increase their 401(k) contributions, especially since a new higher contribution limit will be in effect. The 401(k) deferral limit will rise to $23,500, and individuals aged 50 and older can make catch-up contributions of $7,500. For those aged 60 to 63, a new catch-up limit of $11,250 allows a total contribution of $34,750. It’s advisable to start boosting contributions early in the year to maximize benefits. While aiming to max out contributions is ideal, workers should balance this with immediate financial goals and maintain an emergency fund.
