401(k)
Employer-sponsored savings plan
A 401(k) is a retirement savings plan offered by American employers, named after the section of tax code that created it.
Employees contribute a portion of their paycheck before taxes, and employers often match contributions up to a certain percentage.
The money grows tax-deferred until withdrawal in retirement: I max out my 401(k) every year, She rolled over her old 401(k) when she changed jobs.
Retiree's ongoing benefit
- IRATax-advantaged retirement fund
- nest eggSaved money for later
- Social SecurityFederal old-age insurance program
- retireeOne who left work
annuity · Roth · vesting · rollover · early withdrawal · retirement age · golden years
Things given to help
- portfolioCollected works or assets
- mutual fundsCollectively managed securities portfolios
- index fundsSecurities mirroring market indices
- asset allocationDistributing investments strategically
diversification · stocks · bonds · returns · Vanguard · Fidelity · brokerage
Company duplicates worker savings
- payroll deductionSum subtracted from wages
- benefitsGains or helpful effects
- HREmployee management department
- vesting scheduleTimeline for earning ownership
rollover · automatic enrollment · employee contribution · compensation · W-2
Taxes owed later, not now
- pre-taxBefore levies apply
- traditionalFollowing long-held customs
- RothIRA permitting tax-free withdrawals
- taxableSubject to government levy
withholding · penalty · tax bracket · tax-advantaged · contribution limit · deduction · IRS
pension
Retiree's ongoing benefit
- IRATax-advantaged retirement fund
- nest eggSaved money for later
- Social SecurityFederal old-age insurance program
retiree · annuity · Roth · vesting · rollover · early withdrawal · retirement age · golden years
contributions
Things given to help
- portfolioCollected works or assets
- mutual fundsCollectively managed securities portfolios
- index fundsSecurities mirroring market indices
asset allocation · diversification · stocks · bonds · returns · Vanguard · Fidelity · brokerage
employer match
Company duplicates worker savings
- payroll deductionSum subtracted from wages
- benefitsGains or helpful effects
- HREmployee management department
vesting schedule · rollover · automatic enrollment · employee contribution · compensation · W-2
tax-deferred
Taxes owed later, not now
- pre-taxBefore levies apply
- traditionalFollowing long-held customs
- RothIRA permitting tax-free withdrawals
taxable · withholding · penalty · tax bracket · tax-advantaged · contribution limit · deduction · IRS
- tax shelterstax shelter, 401k, IRA, Roth IRA, FSA
- retirementretirement, retire, retirement age, retirees, retirement income
- employee benefitshealth insurance, pension, 401k, retirement, vacation
- retirement planningretirement fund, IRA, retirement income, pension, retirement age
- retirement savingsretirement savings, retirement funds, 403b, retirement account, retirement fund
- Retirement termspension, retired, annuity, semi-retired, IRA
401(k)pension
Retiree's ongoing benefit
Social Security · company pension · annuity · guaranteed income
401(k)checking account
Bank deposit for transactions
spending money · liquid assets · savings account · cash · cash in hand