Failing to Increase Your Contributions As Your Pay Rises
This is America. If you’re reading this, chances are good that you make enough money to eat and keep a roof over your head. Yes, our expenses rise over time due to inflation and family changes, such as the addition of children. But it’s safe to say that if you were able to survive on the income you earned last year, you should be able to survive on the same amount this year and do so comfortably.
So, as you get salary bumps, try to continue living on your old salary and use the raise to increase your 401k contribution. You don’t have to eat ramen noodles or sell blood to make ends meet. Just avoid lifestyle creep, and you can get a lot closer to maxing out your 401k plan.
I know, I know. That new car is just begging you to buy it. But you can stretch another year out of your old car, and 20 years from now, when you look down at your 401k balance, you’ll be happy you did.