The company 401K match is an unbelievable opportunity to leverage your company's money to help your future and retirement growth.
What is it and how does it work?
Generally, the employer will match the amount that you give toward the account up to a certain amount. It works differently with every company, but the average amount of matching contribution is 4.3% of the employee's pay. Some common amounts of matching are:
50 cents on the dollar up to 6% of the employee's pay. Example: $50,000 salary x 6% = $3,000 / 2 (50 cents on the dollar) = $1,500.
Dollar for dollar up to 3%. Example: $50,000 x 3% = $1,500.
Dollar for dollar up to 6%. Example: $50,000 x 6% = $3,000.
Check with your employer to see what options they offer. Even of you can't afford to max out your 401K, you should at least put in the minimum amount to get their match or else you're leaving money on the table, and you definitely don't want to do that.
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