The Unfortunate Truth About Maxing Out Your 401(k)
If you have one available to you, your 401(k) might very well be one of the most powerful long-term wealth building tools at your disposal. The combination of automatic investing -- straight from your paycheck -- and the tax advantages of a 401(k) make it tough to beat. Add the pretty substantial annual contribution limits ($22,500 for those under age 50, $30,000 for those 50 and up), and it offers a path to potentially build a million-dollar nest egg over the course of your career.
As awesome as that sounds, there can be some real downsides associated with your 401(k). The unfortunate truth about it is that maxing out your 401(k) can cause you some real headaches if things don't fully go your way. As a result, it's important to balance your 401(k) contributions with the rest of your financial plan to give yourself a great chance of reaching your key goals. Here are just three of the key problems you can face if you simply blindly max out your 401(k).
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Source Fool.com
