Once you’ve protected yourself against the unexpected, the next step toward financial freedom is making sure you’re not missing out on money that’s already being offered to you.

Milestone Two of Apriem’s 10 Smart Money Milestones is: Don’t Leave Free Money on the Table.

This milestone is all about maximizing your employer-sponsored retirement plan match—most commonly through a 401(k)—before moving on to more complex financial decisions like paying down extra debt or funding college savings.

In this context, “free money” refers to employer matching contributions to your retirement plan.

If your employer offers a match and you don’t contribute enough to receive it, that money simply goes unused. It doesn’t roll over. It doesn’t get saved for later. It’s gone.

That makes employer matching one of the few true examples of free money in personal finance.

Let’s look at a simple and very common example.

– Your employer matches 100% of the first 3% of your salary

– You contribute 3%

– Your employer contributes an additional 3%

Result:

– You put in 3%

– You receive another 3%

– You earn an immediate 100% return on your contribution

And that return happens every single year your employer offers the match—before any investment growth is even considered.

A common question is:

Why would this milestone come before paying off debt or funding a 529 plan?

The answer is simple: the math.

– Very few debts charge anything close to a 100% interest rate

– Very few investments reliably offer a 100% annual return

– Employer matches are also tax-deferred, allowing your money to compound over time

When you combine:

– Immediate employer contributions

– Tax-deferred growth

– Long-term compounding

…the impact becomes incredibly powerful.

Let’s look at a long-term illustration:

– $1,000 contributed each year

– 30 years of contributions

– 7% annual investment return

Without an employer match:

That $1,000 per year grows to a little over $100,000 after 30 years.

With a dollar-for-dollar employer match:

That same strategy grows to $200,000+—even though you only contributed $1,000 per year.

This is why starting early and capturing the full match matters so much. The longer the money compounds, the larger the impact.

Not all employer matches are structured the same way.

Some common formulas include:

– 100% match up to a certain percentage, then 50% beyond that

– 50% match on the first 6%

– Tiered or blended matching structures

Even in these cases, the principle stays the same.

A 50% match still means:

– A 50% immediate return

– A return higher than most debt interest rates

– A return that’s extremely difficult to replicate elsewhere

That’s why Milestone Two always advocates for capturing the maximum available match, regardless of the formula.

Some employers offer what’s called a safe harbor match, often around 3%, even if employees don’t contribute themselves.

If that applies to you:

– You may be able to complete Milestone Two very quickly

– You’re already receiving free money automatically

That said, it’s still important to confirm:

– Whether additional matching is available

– Whether employee contributions unlock more employer dollars

Understanding the full formula ensures nothing is being left behind.

To complete Milestone Two, take the following steps:

1. Identify your employer’s retirement plan

   • Most commonly a 401(k)

2. Find the employer match formula

   • Review plan documents or HR resources

3. Confirm your current contribution rate

4. Increase contributions if needed

   • Contribute enough to receive the maximum employer match

5. Lock it in

   • Once set, this milestone works quietly in the background year after year

Once completed, you’ve successfully achieved Milestone Two.

Failing to capture employer matching dollars:

• Slows wealth accumulation

• Reduces compounding over time

• Makes later milestones harder to achieve

Capturing the match:

• Accelerates progress toward financial independence

• Increases long-term retirement balances

• Builds confidence in your financial strategy

This milestone isn’t about taking more risk—it’s about being smarter with opportunities already available.

Milestone Two is one of the most impactful steps you can take early in your financial journey. It rewards awareness, discipline, and consistency—without requiring market timing or complex strategies.

If you need help finding your employer’s match formula or want to talk through your options, click below!