Maxing out your 401(k) or IRA is just plain awesome. And even more so, maxing out BOTH in the same year! For the first time in my life, I have done just that, and I can’t tell you how excited I am (even though I sorta kinda already did in my last net worth update).

I was leery to blog about this in case it came off as too “look at me! look at me!”, but a recent comment from Miel at Dinks Finance coaxed me to say a few more words on it – mainly to show that it is, indeed, possible to max out not only your 401(k) for the year, but also your Roth. And the “how” part of it all? Pretty much exactly what Miel left on the previous post of mine:

“…keep stretching yourself and adding on a bit at a time. Back when I first started contributing I thought it was virtually impossible to max out. After we got married I upped my contribution by quite a bit, and then realized I could still get by, so I upped it again. I kept doing this until I maxed out. I was surprised how quickly this happened. It was a great strategy for me and now I max out on auto pilot.”

SO. TRUE. Once you get in the mindset and declare to yourself that YES, I WILL MAX OUT it’s just a matter of time as to when you do. You start upping it a little here and a little there, and before you know it you’re close to maxing-out-land! Now, obviously it requires some hard work and a pretty clean slate to get on this, so if you’re not in the right mindset as yet you may want to backtrack a bit.

Some of you have bad health issues, or you’re in $50k of debt, or you’re spending more than you’re bringing in. If this sounds like you, then scratch away the millionaire to-do list and start focusing in on the very basics. Go through all of your expenditures (or hopefully budget!) and pinpoint the areas of weakness. You may have 1 or you may have 5, but either way it’s important that you find them so you can work on fixing them. Create a “life plan” and actively work on it! It’s only when you clear up a lot of the bad stuff that you can concentrate on upping the good stuff – like your 401(k) and IRAs.

With everything, it all comes down to time and dedication. 3 years ago I couldn’t care less about my retirement funds – I liked seeing my paycheck as full as possible, and I didn’t have any plans on where it went at all. I had no budget, no real savings, and no ultimate desire to pimp my finances. I was just living and coasting along w/out a care in the world ;) It was fun and it worked for a while (26 years, actually) but sooner or later you have to man up and set things in motion. It’s only then that you can really start concentrating on that financial game plan and increase your retirement accounts.

I’m not sure if I totally went off track here, but what I’m trying to say is that you CAN, indeed, max out both your 401(k) and IRA. I did it for the first time this very year, and I can only hope I’ll stick with it and report with the same next year. So, if you really REALLY want to save more and work towards that golden retirement, start today! Up that % another point or two, and continue moving it up every few months. With a little time and patience, you’ll get closer and closer to your goals :)