401(k) Contributions
When you contribute to you Deseret 401(k) Plan account, you are saving for your future retirement. Your employer also provides matching contributions and (depending on your hire date and employer) a generous Employer Discretionary Retirement Contribution (EDRC).FAQs
Your default enrollment is 6% of your salary. We encourage you to contribute at least 5% so you will get the full match of 4% from your employer. The employer match is free money so don’t leave it on the table! If you can, it’s a good idea to contribute 10% or more.
If you turn on auto increase, the percentage of your contribution will increase by 1% or 2% each year until you reach your goal contribution. You can time this increase to coincide with your annual raise so you’ll hardly notice the extra money being set aside from each paycheck.
If you choose to make traditional contributions, the money is deducted from your paycheck before taxes are applied. When you retire, you will pay taxes on distributions from your traditional contributions and gains.
If you choose to make Roth contributions, the money is deducted from your paycheck after taxes are applied. When you retire, you will NOT pay taxes on distributions from your Roth contributions and gains. After saving for 20 to 30 years, Roth gains could be very significant and are never taxed. If you are younger than 50, this may an excellent option for you.
Generally speaking, Roth contributions have bigger payoffs for younger participants who are in lower income tax brackets and who expect tax rates in their retirement years to be higher than the current rates.
Older participants tend to be in higher tax brackets. They also do not have as much time to earn tax-free gains in their retirement investments. In this case, it may be better to switch to traditional contributions to get the benefit of tax-free contributions upfront.
Older participants tend to be in higher tax brackets. They also do not have as much time to earn tax-free gains in their retirement investments. In this case, it may be better to switch to traditional contributions to get the benefit of tax-free contributions upfront.
For 2025, you can contribute up to $23,500 or $70,000 for your contributions and your employer’s contribution combined. If you are age 50 to 59 or 64 or older, you’re eligible for an additional $7,500 in catch-up contributions. If you are between ages 60 and 63, you’re eligible an additional $11,250 in catch-up contributions.
Remember to spread your contributions throughout the year to help you maximize your employer match.
Remember to spread your contributions throughout the year to help you maximize your employer match.