Here’s what you need to know about 401(k) contribution limits, loans and withdrawals.
Contributing to a 401(k) plan via payroll deduction makes it easy and convenient to regularly save for retirement.
A 401(K) PLAN IS A workplace retirement savings account. 401(k) accounts get their odd name from the section of the tax code that created and governs them. Workers and employers can both make deposits to the account until they hit annual contribution limits. The federal government provides tax breaks to workers who save in a 401(k) plan. The employee may choose among a limited menu of investment options selected by the company or plan sponsor. However, money invested in a 401(k) account is meant to be used for retirement, and a penalty is applied to early withdrawals.
Click here to read full article: What Is a 401?
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