For many investors, a 401(k) is simply a retirement savings account. For high-net-worth families, however, it can become a sophisticated planning tool that supports tax efficiency, wealth accumulation, and long-term legacy objectives.
The opportunity may not always be simply contributing the annual maximum. It may be helpful to understand how your retirement plan fits within the broader context of your investment strategy, tax planning, estate planning, and future cash flow. That level of coordination is where meaningful value can emerge.
Here are three advanced strategies that may be worth exploring.
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1. Consider Every Available Contribution Opportunity
Many high-income professionals automatically contribute the annual elective deferral limit but overlook additional opportunities available under their employer’s plan.
Depending on your plan design, this may include enhanced catch-up contributions available under SECURE 2.0, employer matching strategies, or after-tax contributions that increase the total amount saved within the plan. Because contribution limits, Roth requirements, and employer plan provisions continue to evolve, a 401(k) often requires more than simply selecting the highest payroll deduction percentage.
2. Evaluate Whether a Mega Backdoor Roth Strategy Makes Sense
Some employer-sponsored 401(k) plans permit after-tax contributions above the standard employee contribution limit, along with either in-plan Roth conversions or in-service rollovers. When available, this structure may allow investors to move additional assets into Roth accounts where future growth can be tax-free.
Not every plan offers these features, and the strategy isn’t appropriate for every investor. Cash flow needs, current and future tax brackets, investment time horizon, and plan-specific rules all deserve careful evaluation before moving forward.
3. Coordinate Your 401(k) With Your Entire Wealth Strategy
Many affluent families miss the opportunity to optimize their 401(k) as part of a broader wealth management strategy.
We believe your 401(k) should complement, not compete with, your taxable investment accounts, Roth assets, equity compensation, charitable giving strategy, estate plan, and anticipated retirement income. Decisions such as whether to make traditional or Roth contributions, when to recognize taxable income, or how aggressively to accumulate tax-deferred assets can have ripple effects throughout your broader financial picture.
When viewed as part of an integrated wealth strategy, your 401(k) may become more than a retirement account; it is another lever that can help support your long-term financial goals.
At Sequoia Financial Group, this is where we can provide value. Rather than focusing on one account or one tax year, we take a comprehensive view of your financial life. Through our BUILT FOR YOU approach, we coordinate retirement planning with investment management, tax strategy, estate planning, and long-term cash flow planning to create a fully bespoke strategy designed around your family’s unique goals and circumstances. Because when wealth becomes more complex, your planning should become more connected, not more fragmented.
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The views expressed represent the opinion of Sequoia Financial Group. The views are subject to change and are not intended as a forecast or guarantee of future results. This material is for informational purposes only. It does not constitute investment advice and is not intended as an endorsement of any specific investment. Stated information is derived from proprietary and nonproprietary sources that have not been independently verified for accuracy or completeness. While Sequoia believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability. Statements of future expectations, estimates, projections, and other forward-looking statements are based on available information and Sequoia’s view as of the time of these statements. Accordingly, such statements are inherently speculative as they are based on assumptions that may involve known and unknown risks and uncertainties. Actual results, performance or events may differ materially from those expressed or implied in such statements. Investing in equity securities involves risks, including the potential loss of principal. While equities may offer the potential for greater long-term growth than most debt securities, they generally have higher volatility. Past performance is not an indication of future results. Investment advisory services offered through Sequoia Financial Advisors, LLC, an SEC Registered Investment Advisor. Registration as an investment advisor does not imply a certain level of skill or training.
This material is for informational purposes only and is not intended to serve as a substitute for personalized investment advice or as a recommendation or solicitation of any particular security, strategy, or investment product. Diversification cannot assure profit or guarantee against loss. There is no guarantee that any investment will achieve its objectives, generate positive returns, or avoid losses. Sequoia Financial Advisors, LLC makes no representations or warranties with respect to the accuracy, reliability, or utility of information obtained from third parties. Certain assumptions may have been made by these sources in compiling such information, and changes to assumptions may have material impact on the information presented in these materials.
The tax and estate planning information offered by the advisor is general in nature. It is provided for informational purposes only and should not be construed as legal or tax advice. Always consult an attorney or tax professional regarding your specific legal or tax situation. Clients requesting tax return or estate preparation services are referred to a commonly held affiliate, Sequoia Tax Services, or a third party, and not Sequoia Financial Group.
Investment advisory services offered by Sequoia Financial Advisors, LLC, an SEC Registered Investment Advisor. Registration as an investment advisor does not imply a certain level of skill or training.
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