A 401(k) is one of the most powerful retirement savings tools you can have and how you use yours determines how big your nest egg ends up being.
If you want to boost your savings and grow wealth faster, I've got some simple 401(k) hacks to help you do it.
Increase your contributions automatically
Depending on how much you make and how comfortable you want to be in retirement, you should be aiming to save anywhere 10 to 20 percent of your income in your 401(k) at a minimum.
If your employer enrolled you in the plan automatically, your default contributions may be set as a low as 3 percent, which is a pretty big deficit.
Increasing what you're saving by 1 to 2 percent a year is an easy solution and you can set it up so that it happens automatically. That way, you're not seeing your paycheck shrink by a huge amount.
Still not sure you can swing it? Here's a quick example to show you how painless it can be. Annie is 30 years old, single and making $52,000 a year.
She contributes 3 percent of income into her 401(k) and her employer chips in a 50 percent match.
If she increases that 4 percent, her paycheck would drop by $7 per pay period but she'd add $111,000 to her savings, with a 7 percent annual return. That's a pretty good return for what's basically the equivalent of lunch money.
Tip: Check with your employer to see if automatic increases are an option and how you can sign up. Some companies will automatically enroll you in the annual increase feature but others require you to specifically opt in, either by changing your settings through your online retirement account access or calling the plan administrator.
Take the guesswork out of rebalancing your portfolio
When you're saving in a 401(k), you typically have a variety of investments to choose from and if you're not exactly savvy about the market finding the right one can be like finding a needle in the haystack.
Whether you're picking stocks, bonds or mutual funds, you have to look at how each asset compares in terms of the level of risk it carries.
If you're younger and just starting out in your career, taking a more aggressive approach with stocks or exchange-traded funds may make sense.
The odds of losing money are higher but you'll see a bigger return if you pick a winner. As you get older, you'd want to add more conservative investments, like bonds, to your portfolio.
Some 401(k) plans take the guesswork of trying to decide how much of each type of investment you need to have by allowing you to use the auto-rebalancing feature.
If it's available with your plan, you can set this up through your online account access and all you have to do is decide what percentage of each investment you want to have and how often you want to rebalance.
Depending on the plan, you may be able to set it up quarterly, semiannually or once a year.
For instance, if you're in your 20s, you might be comfortable with holding 60 percent of your money in domestic stocks, 30 percent in foreign stocks and 10 percent in bonds.
Someone who's in their 50s might be better off with a 50/25/25 split. The most important thing is that your auto-rebalance settings reflect what your goals are and what your comfort level is with regard to risk.
Stick with low-cost index funds or target date funds
Participating in a 401(k) isn't free and if you're not careful, the fees you're paying can steadily eat into your earnings.
According to the Center for American Progress, the typical worker pays in nearly $140,000 in fees to their plan from age 25 to age 65.
If you're a high-income earner, the fees climb to more than $340,000. That's a substantial amount of money that goes right down the drain when you don't know what kind of fees your plan is charging.
If trying to read the fee schedules for your different investments makes your head spin, the most important number to pay attention to is the expense ratio.
In a nutshell, this is what it costs to maintain a stock or fund each year.
Generally, these can range from as low as 0.2 percent to as much as 2.5 percent.
That doesn't seem like much but over a 30-year period, you'd pay anywhere from $4,000 to $38,000 in fees for every $10,000 you park in your 401(k), assuming a 7 percent return.
Sticking with low-cost index funds or target date funds can cut down on some of the fees you're paying.
Just keep in mind that with target funds, the asset allocation is based on your projected retirement date so if your plans change and you end up working longer, they may not always be the best fit.
Tip: Linking up your 401(k) to the Personal Capital app makes it easy to see how your investments are doing and you can even break down what you're paying in fees so you know which ones are costing you the most money.
Choose a direct rollover if you're changing jobs
Job-hopping isn't a new thing and the trend is especially apparent among millennials.
If you're planning to make a career move, don't make the mistake of leaving your 401(k) behind. While your employer may let you keep the money in your old plan, it's all too easy to forget about it.
Rolling the money over to your new employer's 401(k) or an IRA is a pretty straightforward process and a direct transfer is the easiest way to do it.
With a direct transfer, your old 401(k) administrator sends the money to your new employer or the brokerage that's in charge of your new retirement account.
Depending on how both plans are set up, you may need to fill out some extra paperwork or authorize the transfer over the phone.
If you were to get a paper check made out in your name instead, 20 percent of the money would be withheld for taxes and you'd have to make up the difference before depositing it into your new account.
Otherwise, that 20 percent would be treated as a taxable distribution and if you're under 59 1/2, an additional 10 percent penalty would apply.
You can get around the penalty by requesting that the check be addressed to the new plan itself.
Tip: Check with your new employer to see what the rules are for rolling over your old 401(k) since not all companies allow this.