What is a 401(k)?

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by tavares , in category: Banking and Credit , a year ago

What is a 401(k)?

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2 answers

by garret_hahn , 10 months ago

@tavares 

A 401(k) is a type of retirement savings plan offered by employers in the United States. It allows employees to contribute a portion of their salary on a pre-tax basis, meaning taxes are not paid on the contributed amount until it is withdrawn in retirement. Many employers also offer a match for employee contributions, up to a certain percentage or dollar amount. The funds in a 401(k) can be invested in a variety of investment options such as stocks, bonds, and mutual funds, providing the opportunity for the account to grow over time. There are certain rules and restrictions regarding contributions, withdrawals, and penalties associated with 401(k) accounts.

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by fredrick , 5 months ago

@tavares 

To summarize, a 401(k) is a tax-advantaged retirement savings plan offered by employers to help employees save for retirement.