Take Control of Your Future: A Comprehensive Guide to Adjusting Your 401(k) Contribution with Fidelity
Hey there! Are you looking to supercharge your retirement savings, or perhaps you need to tweak your contributions to better align with your current financial situation? Whatever your reason, adjusting your 401(k) contributions with Fidelity is a crucial step towards securing your financial future. Many people set their contributions once and forget about it, but your financial landscape changes, and so should your retirement strategy. This lengthy guide will walk you through the process step-by-step, ensuring you feel confident and in control.
Let's dive in and make sure your 401(k) is working for you!
Step 1: Understanding Your Current Financial Picture and Goals
Before you even log into your Fidelity account, take a moment to reflect. This isn't just about changing a number; it's about aligning your savings with your life.
Sub-heading: Why Are You Adjusting?
Increasing Contributions: Are you aiming to max out your 401(k) for the year? Did you get a raise or a bonus? Are you trying to catch up on retirement savings? Increasing your contributions is an excellent way to take advantage of compounding returns and potential employer matches. Remember, the 401(k) contribution limit for employee deferrals in 2025 is $23,500. If you're 50 or older, you can contribute an additional $7,500 in "catch-up" contributions, bringing your total to $31,000.
Decreasing Contributions: Are you facing unexpected expenses? Do you need more cash flow for a short-term goal, like a down payment on a house? While decreasing contributions should be a last resort, sometimes it's necessary. Be mindful of the potential long-term impact on your retirement savings.
Changing Contribution Type: Do you want to switch from pre-tax to Roth 401(k) contributions, or vice-versa? Pre-tax contributions lower your taxable income now, while Roth contributions are made with after-tax money but grow and are withdrawn tax-free in retirement. Understanding the tax implications is vital for your long-term financial plan.
Sub-heading: Reviewing Your Employer Match
This is critical! Many employers offer a matching contribution to your 401(k). This is essentially free money for your retirement. Before you make any changes, ensure you are contributing at least enough to get your full employer match. If you reduce your contributions below this threshold, you're leaving money on the table. Check your plan documents on NetBenefits.com to understand your specific employer match rules.
Step 2: Accessing Your Fidelity NetBenefits Account
Now that you've got your "why" sorted, it's time to log in.
Sub-heading: Logging In for the First Time (or if You Forgot Your Details)
If this is your first time accessing your 401(k) online, or if it's been a while, you'll need to register or sign in.
Go to NetBenefits.com: This is the primary portal for your workplace retirement accounts managed by Fidelity.
Register or Sign In:
New Users: Click "Register Now" and follow the prompts to create your username and password. You'll likely need your Social Security number and possibly your plan number or employer's name.
Existing Users: Enter your username and password. If you've forgotten them, use the "Forgot username" or "Forgot password" links. Fidelity has robust security measures, so be prepared to answer security questions or use a verification method.
Sub-heading: Navigating to the Contribution Section
Once you're successfully logged in, the Fidelity NetBenefits interface is generally intuitive, but here's how to find what you need:
Locate "Quick Links": On your NetBenefits homepage, you'll usually see a section called "Quick Links" or a similar menu. This is your shortcut to various account management features.
Select "Contribution Amount": From the "Quick Links" menu, select "Contribution Amount." You might need to select it again on the subsequent page.
Step 3: Initiating the Contribution Change
You're almost there! This step is where you tell Fidelity what you want to change.
Sub-heading: Beginning the Change Process
Click "Begin Change Contributions": Once you're on the "Contribution Amount" page, look for a button or link that says "Begin Change Contributions" and click it.
Sub-heading: Understanding Contribution Types
Your 401(k) plan might offer several contribution types:
Pre-Tax 401(k): These contributions are deducted from your paycheck before taxes are calculated, lowering your current taxable income. Your contributions and earnings grow tax-deferred until withdrawal in retirement.
Roth 401(k): These contributions are made with after-tax money. While they don't reduce your current taxable income, qualified withdrawals in retirement are entirely tax-free.
After-Tax 401(k): Some plans allow after-tax contributions beyond the pre-tax and Roth limits. These contributions grow tax-deferred, and the earnings are taxed upon withdrawal. This option is often used by those pursuing the "mega backdoor Roth" strategy.
Step 4: Adjusting Your Contribution Percentage or Amount
This is the core of the process.
Sub-heading: Modifying Your Regular Pay Contributions
You'll typically see fields where you can enter a percentage or a specific dollar amount for your contributions.
Adjust the Percentage/Amount:
To change your regular pay contribution to the Pre-Tax 401(k), modify the percentage under "Pre-Tax Deferral."
To change your regular pay contribution to the Roth 401(k), modify the percentage under "Roth Deferral."
If your plan allows, to change your regular pay contribution to the After-Tax 401(k), modify the percentage under "After-tax."
Consider Your Paycheck Impact: Think about how this change will affect your net pay. Fidelity's system may provide an estimate of your new net pay after the changes, which is incredibly helpful for budgeting.
Sub-heading: Adjusting Bonus Pay Contributions (If Applicable)
If your employer offers a bonus and allows you to defer a portion of it into your 401(k), you'll likely see separate fields for bonus contributions:
Modify the percentage under "Pre-Tax Bonus," "Roth Bonus," or "After-tax Bonus" as desired.
Sub-heading: Reviewing Contribution Limits
As you make adjustments, keep the annual contribution limits in mind. Fidelity's system should warn you if you're exceeding the IRS limits, but it's your responsibility to track your contributions, especially if you've changed jobs during the year and contributed to another 401(k).
2025 Employee Contribution Limit: $23,500
2025 Catch-Up Contribution Limit (Age 50+): Additional $7,500 (total $31,000)
2025 Combined Employee + Employer Contribution Limit: $70,000 (check your specific plan for any lower limits)
Step 5: Reviewing and Confirming Your Changes
Almost done! This is the double-check phase.
Review Your Elections: After adjusting your contribution amounts, you'll be redirected to a review page. Take your time here. Ensure all the percentages and amounts are exactly what you intended.
Verify Effective Date: Pay attention to the effective date of your changes. This indicates when your new contribution amounts will begin to be deducted from your paycheck. It might be your next payroll cycle or a future one, depending on your employer's payroll schedule.
Submit Your Changes: If you're satisfied with your elections, click "Submit." You may also have the option to go "Previous" if you need to make additional modifications.
Save Your Confirmation: It's highly recommended to save or print a copy of your confirmation page. This serves as proof of your request and can be useful if any discrepancies arise later.
Step 6: Monitoring Your Contributions
Your work isn't entirely over after submitting.
Check Your Pay Stubs: After the effective date, carefully review your pay stubs to ensure the new contribution amounts are being deducted correctly.
Monitor Your Fidelity Account: Periodically log back into NetBenefits.com to verify that your contributions are being processed as expected and are reflected in your account balance.
Adjust as Needed: Your financial situation is dynamic. Don't be afraid to revisit your contributions if your income changes, you have new financial goals, or you simply want to optimize your retirement savings.
Frequently Asked Questions (FAQs)
How to: Find My Employer's 401(k) Match Details on Fidelity?
Log in to NetBenefits.com, navigate to your 401(k) plan, and look for "Plan Information and Documents" or a similar section to find details on your employer's matching contributions.
How to: Determine if My Plan Offers Roth 401(k) Contributions?
After logging into NetBenefits.com and selecting "Contribution Amount," you will see options for "Roth Deferral" if your plan supports Roth 401(k) contributions.
How to: Know if I'm Eligible for Catch-Up Contributions?
If you are age 50 or older by the end of the calendar year, you are eligible for catch-up contributions. Fidelity's system should automatically allow you to contribute up to the higher limit if your plan permits.
How to: Change My Investment Allocation within My Fidelity 401(k)?
While this guide focuses on contributions, you can change your investment allocation by logging into NetBenefits, going to your 401(k) plan, and looking for options like "Change Investments" or "Investment Elections."
How to: Handle Over-Contributing to My 401(k)?
If you accidentally over-contribute, contact Fidelity's Workplace Investing team or your employer's HR/benefits department immediately. They can guide you on the process for returning excess contributions, which must generally be done by April 15th of the following year to avoid penalties.
How to: See My 401(k) Balance and Performance?
Log in to NetBenefits.com. Your current 401(k) balance and performance summaries are typically displayed prominently on your account's dashboard.
How to: Update My Beneficiaries for My Fidelity 401(k)?
On NetBenefits.com, look for a section on "Beneficiaries" or "Profile & Settings." You can typically add or update primary and contingent beneficiaries online.
How to: Take a Loan or Hardship Withdrawal from My 401(k)?
This is more complex and has specific rules. On NetBenefits.com, look for "Loans" or "Withdrawals" under your 401(k) plan. You'll need to meet strict IRS and plan-specific criteria, and these options often come with tax implications and penalties. It's advisable to speak with a Fidelity representative or financial advisor first.
How to: Roll Over an Old 401(k) into My Current Fidelity Account or an IRA?
Fidelity provides detailed guides for rollovers. You can initiate this process from NetBenefits.com by looking for "Rollovers" or contacting Fidelity directly. You'll typically need to confirm details of your old plan and decide on the destination (new 401(k) or IRA).
How to: Get Live Assistance from Fidelity Regarding My 401(k)?
You can call Fidelity's Retirement Benefits Line (often found on your NetBenefits login page or statements) or use their online chat feature for personalized assistance.