JohnLong

This makes sense. I have been with the company for three years now. I vaguely recall the HR manager saying something about it when I questioned the 20%. I believe he said there would be catch up period at the end of the year. I need to touch base with him. Thanks again, you guys are the best.

Well, I wish I was a highly compensated employee, but my gross is around $75k. (15K is 20% of 75k) Yes, it is a small company. There are probably less than 50 employees. They do not run the plan, Fidelity handles it for them. There is no language that says only 20%. Apparently, most employees do not maximize their contribution. Since I am older than most, I am allowed to contribute more. I believe the below quote from the IRS website is what the company uses to justify my reduced contributions. I am neither of these. I mighty be considered a highly compensated employee compared to most of my co-workers. I really do not know. So what are my options, how do I get around this regulation. "If you are a manager, owner, or highly compensated employee, your plan might need to limit your deferrals to pass nondiscrimination tests"

When I initially joined my employers 401K , (three years ago) I elected to contribute 30% of my pay. This would put me near the maximum dollar amount allowed. My employer will only deduct 20% of my pay for my 401K . I did some research and found that they are allowed to do this. Apparently there is a rule to keep a few employees from contributing way more than the rest of the employees. So I am contributing $15k a year. My age allows me to contribute up to $25k. What can I do to make up for this shortfall? I already max out my IRA contribution.