What Is The Impact Of Increasing My 401(k) Contribution?

A 401k plan is contributed to directly from the employee’s salary, through an account run by the employer. The employee has the right to deliberate and decide how much he/she wants to contribute into their 401K, i.e., the percentage of their salary that they want to keep aside as a contribution to this plan. While it may cause a slight deficit in the short run, increasing your 401K contribution can have a very positive impact for your financial condition in the long run. Hence, those with higher earnings are usually advised to contribute a larger percentage into their 401K.