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What are 401(k) plans?

Category : Finance | Answer: 1 5 Years Ago

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401(k) Plan –In this type of defined contribution plan, the employee can make contributions from his or her paycheck before taxes are taken out.The contributions go into a 401(k) account, with the employee often choosing the investments based on options provided under the plan. In some plans, the employer also makes contributions, matching the employee's contributions up to a certain percentage.SIMPLE and safe harbor 401(k) plans have additional employer contribution and vesting requirements

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