It is always a good idea to participate as much as possible in your 401k plan, but especially if they have a matching program. You would not want to pass up this free money.
You have money withdrawn from paycheck and put into 401K account, saving for your future AND reducing your taxable income.
Your employer matches the first X% you put into 401k.
Thus IF you are NOT putting in at least the match amount....you are leaving money on the table, not getting part of the compensation package
Just remember the money in there STAYS there until age 59 1/2 or you lose 25-50% of it by withdrawing it
The employer matches any 401k contributions you make on the first X% of your income. It can take different forms. My current employer matches 100% on the first 5% of my income. So if I put 10% of my income into the 401K the mplyer puts in an amount equal to 5% of my income, if I put in 5% they match 5%, if I put in 4% they put in 4%.
My prior employer matched 50% on up to the first 6%. So 10% they put in 3%, 5% they put in 2.5%, 4% they'd put in 2%.
Your employer puts in money if YOU do... up to a point. Employer matching and tax deferral combine to make a 401(k) a VERY good investment. It is VERY hard to find anything better.
Do it... It doesnt matter what they are matching. Take all the free money that you could take from the company that you work for(legal ways of course) because it is basically a raise that will compound over years....
Best of luck
Some employers match a percentage of the money you put in.
Typically, you put in one dollar and your employer will match it with some amount (a quarter, a half a dollar, or even one dollar).
If you are eligible, your employer will give you all the details.
