Maxing out your 401(k) isn't easy.

Shot of a group of friends celebrating with drinks at a restaurant

Maxing out your 401(k) each year is not unlike scaling Mount Everest.

“What a feat!” you might say. And: “No way am I doing that.”

While challenging, it’s doable, according to a survey of people who’ve contributed the max, or almost that, to their 401(k)s.

“One thing they’re not doing is living miserable lives,” says Jerry Patterson, senior vice president of retirement at Principal Financial Group, which surveyed about 1,500 people who saved $16,500 to $18,000 in their 401(k)s in 2017.

In 2018, the maximum contribution is $18,500 ($24,500 if you’re 50 or older). If you’re not maxing out your 401(k), you’ve got company: Only 9% of people saved the maximum in 2017, according to Fidelity Investments data covering 15.3 million plan participants.

This story is about finding inspiration to ramp up your savings rate. To that end, here are super-savers’ top responses in the Principal survey to the question, “what did you sacrifice to get here?”

  • 44% said they deal with high amounts of work-related stress — that is, work harder than they’d like, in order to save more.
  • 40% said they don’t travel as much as they’d like.
  • 39% said they drive an older car.
  • 33% said they own a modest home.

Still, they aren’t immune to temptations: 51% said they travel, 44% buy subscription entertainment (think Netflix) and 27% splurge while shopping.

The importance of choices — and luck

When you ask Tanja Hester how she maxed out her 401(k), you hear similar responses. She and her husband, who live in California’s Lake Tahoe area, retired in 2017, when she was 38 and he was 41.

“We drive a 15-year-old car. We have a house that a lot of Realtors would call a starter home, which we call our forever home,” says Hester, who writes the “Our Next Life” blog and whose book “Work Optional: Retiring Early the Non-Penny-Pinching Way” will publish in 2019.

It’s partly about your choices, but luck comes into it, too, she says, noting that they bought a house during the economic downturn.

Tips for maxing out your 401(k)

Certainly, a higher income will help anyone max out savings. For the respondents in the Principal survey, the average income was a hefty $155,000. But a quarter of those retirement savers had an average salary of $75,000 — comfortable, but not ultra-wealthy.

Here are three strategies to increase retirement savings at any income:

1. Take it slowly. Start by saving, then increase your rate when you get raises and whenever it’s feasible. “Doing it little by little and being really consistent is the way to get there,” Hester says. Fidelity found that almost 3% of millennials have maxed out their 401(k), compared with nearly 16% of 60- to 64-year-olds.

2. Choose automation over budgeting. The Principal survey found that 70% of retirement super-savers don’t use a budget. If you automate your savings, it’s out of your hands. “Then, you don’t have to use willpower,” Hester says.

3. Believe in your money smarts. One reason many people don’t tackle financial goals is they lack confidence when it comes to money, according to another Principal survey. Often, “the amount of income or the amount of debt is not what’s driving people to postpone taking action around finances,” Patterson says. “It’s really around whether they have confidence.”

Reading a story like this one can help, Patterson says. Another way to grow your confidence? Use a retirement calculator to check your progress, and read about low-stress ways to invest for retirement.

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