A Quick Guide to Maximizing Your Meta (Facebook) 401k

By fully leveraging your financial opportunities while working for Meta (formerly Facebook), you can build a strong foundation for your future.

Among many financial benefits, Meta offers a robust 401k plan for its employees. Through this plan, Meta workers can defer part of their salary towards their retirement. Furthermore, both employee contributions and employer matches to Meta (Facebook) 401ks are fully vested immediately. 

Read on for a closer look at how you can maximize your Meta 401k.

Max Out the Employer Match

When trying to optimize your Meta (Facebook) 401k, your top priority should be hitting your maximum annual contribution limit. That is crucial because in 2022, Meta began matching 50% of employee contributions, up to the IRS’s yearly limit. Therefore, if a Meta employee contributes $23,000 in 2024, they will receive an employer match of $11,500. 

In most situations, this will be more money in employees' pockets. It’s important to note, however, that high-salaried employees may actually see less contribution because of the fixed dollar limitation, rather than a percentage limitation. For example, if you receive a base salary of $300,000 the $11,500 match represents only a 3.8% match. 

Catch-Up Contribution

The amount you’ll be able to contribute to your 401k at Meta depends on your age. Employees under the age of 50 can add $23,000/year to this account. If you’re 50 or older, you can add a $7,500/year “catch-up contribution” to that amount, for a total of $30,500.

Unlike many other employers, Meta’s 401k match also applies to catch-up contributions. That means that most employees who max out their 401k contributions will receive $11,500 in matching funds, but employees who are at least 50 will get $15,250. As a result, maximizing 401k contributions should be an even higher priority for workers in this age group.

Utilize the After-Tax to Roth 401k (aka Mega Back Door Roth)

The After-Tax to Roth 401k (aka “Mega Back Door Roth”) makes it possible for Meta employees to contribute above the $23,000 limit to their 401k.

As of 2024, the IRS maximum for all 401k contributions is $69,000. This includes the $23,000 employee deferral and Meta’s $11,500 employer match. As a result, employees can contribute an additional $34,500 to their after-tax 401k. Note that this limit does not count catch-up contributions, and those eligible could contribute up to $76,500.

The Meta 401k plan also allows participants to automatically convert their after-tax contributions to the Roth 401k. This allows all after-tax contributions to grow & be distributed tax-free - a huge benefit. It is extremely important to know that if you do not set up this auto conversion feature, all growth on after-tax contributions will be taxable as income at retirement, missing out on the tax-free benefits of the Roth 401k. 

Choose Your Own Funds

In the process of managing your Meta 401k, you’ll have the chance to choose from an impressive selection of investment opportunities. While you’ll want to talk to a financial advisor before making major investment decisions, it’s also a good idea to understand your options.

Meta’s 401k plan is administered by Fidelity, which offers several target date funds to participating employees. You can choose the right fund for you based on your expected retirement date–the closer you are to retirement, the less aggressive your fund will become.

Fidelity also allows Meta employees to invest in many other mutual funds, including stock funds, real estate funds, and money market funds. On top of that, you’ll be able to invest in Meta stock through your 401k; however, if you already have Meta RSUs, diversifying your investments may be a better idea.

Get Expert Guidance

Planning for your financial future can be overwhelming. While working with a reliable financial advisor is a great way to take advantage of all Meta has to offer, it’s important that you trust them to help you make the best decisions to reach your goals. Want to own a boat? Retire early? Travel? Consilio Wealth Advisors is here to make it easy. 

We focus on financial planning services specifically for people in the tech industry and work with you to map out a fully customized financial roadmap in terms you can understand. 

If you’re a Meta employee looking to maximize the benefits and compensation you receive, access our free library of guides and resources for more tips and strategies.

Disclosures: 

The information provided is for educational and informational purposes only and does not constitute investment advice and it should not be relied on as such. It should not be considered a solicitation to buy or an offer to sell a security. It does not take into account any investor's particular investment objectives, strategies, tax status or investment horizon. You should consult your attorney or tax advisor.

The views expressed in this commentary are subject to change based on market and other conditions. These documents may contain certain statements that may be deemed forward‐looking statements. Please note that any such statements are not guarantees of any future performance and actual results or developments may differ materially from those projected. Any projections, market outlooks, or estimates are based upon certain assumptions and should not be construed as indicative of actual events that will occur.

All information has been obtained from sources believed to be reliable, but its accuracy is not guaranteed. There is no representation or warranty as to the current accuracy, reliability or completeness of, nor liability for, decisions based on such information and it should not be relied on as such.

Consilio Wealth Advisors, LLC is not affiliated with Meta (Facebook), and this article is not intended to represent any sponsorship or solicitation. Consilio Wealth Advisors often meet with Meta clients, and maintain an understanding of Meta compensation and benefits. 

Consilio Wealth Advisors, LLC (“CWA”) is a registered investment advisor. Advisory services are only offered to clients or prospective clients where CWA and its representatives are properly licensed or exempt from licensure.