Retirement Retirement Planning

6 Underrated Ways to Maximize Your 401(k) in 2026

The new year marks the perfect time to revisit your investment strategy.

By Chris Kissell

Edited by Laura Hohenstein

Updated Jan. 22, 2026

A new year offers the opportunity to tweak your retirement plan for success. One of the best ways to do that is to squeeze more out of your 401(k) plan.

Although a 401(k) is often a worker's largest retirement asset, many people fail to take the time each year to revisit how they're using it. Here are six underrated strategies to get the most from your 401(k) plan in 2026.

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Take advantage of your employer's match

Many companies match a percentage of an employee's contributions to a 401(k) plan. Fidelity says 85% of the plans for which it is the service provider offer some type of match.

A typical match in these plans may be dollar-for-dollar on the first 3% of an employee's contributions. After that, many plans match 50 cents on the dollar for the next 2%.

If you are not taking advantage of this match, you are leaving money on the table. This year can be a great time to boost contributions so you capture more of the match.

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Make catch-up contributions if you are eligible

The federal government uses "catch-up contributions" to incentivize older workers to contribute more to 401(k) plans as they get closer to retirement.

In 2026, workers who are 50 or older can contribute an extra $8,000 to their 401(k) plan on top of the standard $24,500 that applies to all workers.

Even better, workers between the ages of 60 and 63 can contribute an extra $11,250 instead of the $8,000 catch-up contribution available to seniors of other ages.

Check your investment expenses

High investment expenses can be a significant drag on your efforts to build a large nest egg.

In fact, such fees can "substantially reduce the growth in your account, which will reduce your retirement income," according to the U.S. Department of Labor.

Even small fees can cost you thousands or even hundreds of thousands of dollars in savings over time. Such fees typically fall into three categories:

Plan administration fees
Investment fees
Individual service fees

One way to reduce the toll of such fees is to choose investments with lower cost structures. For example, index funds often have lower fees than actively managed funds.

Of course, fees aren't the only thing to consider when you invest. If you are unsure about where to invest your money, sit down with a financial advisor who can offer guidance.

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Weigh whether a Roth option makes sense

Your 401(k) plan may offer both a traditional and a Roth option.

With a traditional option, you get a tax-break in the year you make a contribution, and your earnings in the account grow tax-free. However, when you withdraw the money in retirement, you finally pay taxes on both contributions and earnings.

With the Roth option, you make after-tax contributions. This means you do not get a tax break during the year of contribution. However, earnings grow tax-free, and both contributions and earnings can be withdrawn tax-free in retirement.

Which option is right for you? Many experts say you should lean toward the Roth option if you expect your taxes to be higher in retirement than during your working years.

But this is just a rule of thumb. Other factors can be important to consider when weighing whether to go traditional or Roth.

Rebalance to your risk tolerance

The U.S. stock market has been on a tear, recording big gains for three straight years. When stocks do well, it can throw your asset allocation out of whack.

For example, if you prefer a balance that is 60% stocks and 40% bonds, a rising market can tip your balance toward stocks well over the 60% threshold. By rebalancing, you sell some of your stock gains and use the proceeds to buy more bonds so you return to your preferred 60/40 split.

You may also want to rebalance as you get closer to retirement. For example, some investors who were willing to take a bit more risk in their 401(k) when they were younger may opt to move to a 50/50 balance as retirement nears.

Again, there is no one right answer here — only an answer that is correct for you and your financial needs and goals.

Discuss your situation with a financial advisor

As mentioned previously, the stock market has had three consecutive years of big returns. That means the market might be overvalued and due for a big correction.

Of course, it might not mean that at all. It's also possible that markets could continue to rocket higher for months or even years into the future.

Confused? Join the crowd. Nobody knows where the stock market is headed. The best you can do is create a sound strategy that mitigates your risks and helps you achieve financial goals while sleeping soundly at night.

If you are unsure of the right path forward, sitting down with a financial advisor in 2026 can be a smart investment in your future.

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Bottom line

As the calendar moves to a new year, it marks a great time to take another look at your 401(k) plan and make sure you are on a path to achieve a comfortable retirement.

Taking some time in 2026 to re-evaluate your investing strategy can pay off for years to come once you finally reach retirement.

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