Finding the Money to Put in Your 401k: There is No “One Weird Trick”
Hi Friendos,
Today is our last installment of 401k summer school. I’ll recap what we’ve covered so far and end with how you can perhaps find a bit more money to put toward retirement saving. Some dreams are out of reach no matter how hard we try, but if you regularly save and invest for retirement, you will amass a nest egg for when you’re older. You can achieve the modest dream of having enough to pay for groceries, utilities, housing, and a few small comforts in the later years of your life. It is a dream we all deserve.
I recently met a financial planner, River Nice, who has some non-traditional views on financial markets. Sometimes their clients, and mine, feel despair about climate change and our broken political system, and wonder if all this effort to save for the future makes sense when our current world may not continue to exist at all. I asked River, what do you say to such clients? River said, “What if everything is still the same? We have to prepare for that scenario also.”
Here’s what we’ve covered in prior weeks of 401k summer school (you can swap in “403b” if that’s the type of account you have), in case everything stays the same…
- 5/17/2026: Putting money into a 401k account is a separate step from investing the money.
- 5/24/2026: You can usually change your 401k contribution any time during the year (not always). The change usually takes effect at the next pay cycle. Every 401k plan works a little differently, so every time you change jobs you have to learn a little bit about your new 401k. Any time your change your contribution, check your subsequent paystub to make sure it went through the way you expected.
- 5/31/2026: You can use weirdly small paychecks to get a lump of cash into your 401k.
- 6/7/2026: Changing the investments of existing money in the account is different from changing the investments for new money you add to the account later.
- 6/14/2026: You will not owe any taxes if you swap investments inside your 401k.
- 6/21/2026: Fees can have a big impact on your future wealth. Even though you may have to dig a little to identify fees in your 401k, it’s a one-time chore and worth the effort.
- 6/27/2026: Employer matching in a 401k can be implemented in different ways, and if your 401k contributions vary throughout the year, you may not get the full match. Unless you have a specific reason to do otherwise, I advise contributing evenly throughout the year.
- 7/12/2026: For most people, the best investment option is a target date fund. Owning just one target date fund does not mean you lack diversification, because a single target date fund may own several thousand investments inside of it.
- 7/18/2026: If your 401k plan does not offer a target date fund, you can select investments by (1) deciding on an asset allocation, (2) identifying specific investments by starting your research with the lowest fee options.
- 7/26/2026: Do get your full employer match if one is offered, although if you have credit card debt, paying that off should probably be your first priority. I recognize that this is not a mathematically optimal approach, but I think it is appropriate to take emotional and psychological factors into account when making decisions around money.
- 8/9/2026: It’s ok to own the same investment inside multiple accounts, such as inside a 401k and inside an IRA.
- 8/16/2026: It’s a hassle to rollover a 401k account from an old job, but you should do it anyway. Phone calls are the most effective way to get information you need for this process.
Phew! There are so many little nuances to fully getting the hang of these accounts. The great news is that you don’t have to master all of this to do an awesome job of saving for your future self. The most important thing is to spend less than you make and save and invest the rest.
Just like building up an emergency fund, there is no secret magic to finding ways to save more for retirement. It is hard work and the exact things that work for one person may not be identical for someone else. Below I float a few ideas; I hope some of them could work for you, or perhaps get you thinking of something else that would work for you:
- If you get a raise, apply all or most of the raise to increasing your retirement savings. You were getting by without the raise, so hopefully you can keep doing what you were doing and use the raise to increase your financial safety.
- Increase your 401k contribution a little bit (say, an extra 1% of your paycheck) and see if your other spending can naturally adjust. Do that again in 4 months, and again in 8 months.
- Start tracking your spending and see if you organically spend less because you are paying more attention to it and have set an intention to save more for the future. If so, increase your automated 401k contribution to effortlessly invest the extra for your future self.
- If you have a temporary/part-time/gig job, designate all that income for retirement saving.
- If you cancel a subscription or eliminate another recurring expense, increase your monthly retirement saving by that amount.
It’s been a great summer! The Boring Newsletter is taking a couple weeks off for some r&r and will be back in September.
-Stephanie
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