As a tax-deferred vehicle, it allows your investment to compound quickly. When employers match your contributions, the extra money automatically guarantees you a good return. Only if your investment choices are limited should you commit less than the maximum to the plan. Many park their money in bonds, money markets, or other conservative investments. Over the long haul, the gains from these plans are likely to be dwarfed by earnings in stock funds.
Stocks are riskier in the short run but historically have had the best long-term returns.
Some plans also allow participants to make after-tax contributions, which aren't included in the government limit. Also think about opening a traditional IRA or Roth IRA if you're looking for more retirement investments for your post-tax money. Contact your employers' benefits departments as soon as possible to correct the error. You must have the excess amount refunded to you before April 15 of the year following the calendar year in which you paid too much.