Employer 401k Match: Does it Count Towards Maximum Limit?

Shawn Plummer

CEO, The Annuity Expert

Does employer 401k match count towards the annual limit?

Do you want to take advantage of a max contribution to a 401k? Do you know if your employer’s 401k match counts towards the maximum limit? The answer is yes, but does it count as a contribution from the individual, or does it count as an employer contribution? These two factors can make a huge difference.

Read on to learn more about your employer’s 401k match counts towards the maximum limit and how this impacts retirement savings.

401(k) Contribution Limits Overview

  • Individuals can contribute up to $19,500 to a 401(k) in 2021 and $20,500 in 2022, or $26,000 if they are age 50 or over in 2021 and $27,000 in 2022.
  • An employer match to an employee’s 401(k) does not count toward the employee’s annual contribution limit.
  • There is a maximum amount that an employee and employer together can contribute to a 401(k). The same restrictions apply to 403(b), 457 plans, and Thrift Savings Plan (TSP).

2021 and 2022 Contribution Limits

If you’re an employee, in 2021, you may contribute up to $19,500 of your own money to a 401(k) and $26,000 if you’re 50 or older. If you’re an employee, in 2022, you may contribute up to $20,500 of your own money to a 401(k) and $27,000 if you’re 50 or older.

These are the 2021 and 2022 limits for specific retirement plans, including 401(k), 403(b), 457, and a Thrift Savings Plan.

The limit on total contributions from both the employee and employer can’t exceed the lesser of 100% of the employee’s salary or $61,000 for employees younger than age 50 and $67,500 for those age 50 or older.

How 401(k) Plan Contribution Limits Work

The 401(k) plan is a long-term savings plan designed to help people build their retirement savings. The IRS labels a 401(k) as a “qualified retirement plan,” which means it has certain tax benefits for the employee, the employer, or both.

The tax advantage for employees is that their contributions are deducted from gross income, not net income. That means less take-home pay, which lowers the employee’s taxes, and the money goes into an investment account on an ongoing basis.

For some 401(k) plans, employers can match some percentage of their employees’ contributions, but it’s strictly voluntary. The average 401(k) match ranges from 3% to 7% of the employee’s gross salary.

Alternatives To An Employer 401(k) Match

Deferred annuities can offer premium bonuses on contributions that mimic an employer’s 401(k) match with no annual limits.

For example, an annuity may offer up to an 11% bonus on all contributions for the first seven years of the annuity. The 11 percent premium bonus mimics the employer’s match, and the employee has no annual contribution limits.

Unlike a 401(k), employees can open a deferred annuity without an employer.

Annuities That Offer Bonuses

Shop and compare annuity plans that will provide a premium bonus similar to a 401(k) contribution match.


An annuity could be the answer if you’re looking for a way to contribute more to your 401(k). Deferred annuities offer premium bonuses on contributions that mimic an employer’s 401(k) match with no annual limits, making it easy to save for retirement. Use a 401(k) match calculator and request a quote today to see how much of a 401(k) you can earn from an annuity.

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Frequently Asked Questions

How Much Can I Contribute To My 401(k)?

The most you can contribute to a 401(k) is $20,500 for 2022 ($27,000 in 2022 for those age 50 or older).

Shawn Plummer

CEO, The Annuity Expert

I’m a licensed financial professional focusing on annuities and insurance for more than a decade. My former role was training financial advisors, including for a Fortune Global 500 insurance company. I’ve been featured in Time Magazine, Yahoo! Finance, MSN, SmartAsset, Entrepreneur, Bloomberg, The Simple Dollar, U.S. News and World Report, and Women’s Health Magazine.

The Annuity Expert is an online insurance agency servicing consumers across the United States. My goal is to help you take the guesswork out of retirement planning or find the best insurance coverage at the cheapest rates for you. 

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