1. Eligibility Date
Many times an employer does not offer new employees the
opportunity to immediately participate in the employer provided 401(K)
retirement savings plan. Know when you are eligible to make contributions to
your employers 401k program. Knowledge of the eligibility date can help you be
prepared to make a decision about your retirement.
2. Cash Flow
In order to accurately plan for retirement, an individual
will need to know the monthly payout that their 401(K) offers. A retiree will
want to have enough monthly income from their retirement plan to budget
accordingly to help cover everyday expenses.
3. Employer Match
The average amount for employers to match is three percent
of the employee contribution. It is recommended that an employee take advantage
of a matching program if it is offered, because it is essentially free money
put toward your retirement. Knowing the percentage an employer matches can help
you better plan for how much you anticipate having in your 401(K) when it comes
time to retire.
4. Vesting Schedule
Sometimes an employee must be with the company for a certain
length of time before they are eligible to receive the matched contributions
from their retirement fund. Know the vesting schedule for your specific company
to ensure you gain the most from your 401(K) retirement account.
5. Roth Contribution
Almost half of 401(K) plans let employers make a Roth
contribution, which is when the employer contributes money after taxes have
been taken out. A traditional 401(K) is taxed when money is taken out whereas a
Roth 401(K) is taxed before they money goes in, not when it is withdrawn. This
can help diversify your retirement savings method for more flexible options in
retirement.
6. Early Withdrawal Penalties
There may be an early withdrawal option when it comes to
taking money out of your 401(K) retirement account. From early retirement to
hardship withdrawals, know the penalties that are associated with withdrawing
money early from your retirement account.
7. Rollover Options
Employees are making career moves more and more often in
their working years. A 401(K) retirement plan can follow an employee around
from company to company throughout their career. There are a number of rollover
options when it comes to changing employers, be sure to know your options for a
401(K) roll over.
Many Americans know the importance of saving for retirement
and participate in a 401(K) retirement savings plan. When planning for your
retirement, there are a number of factors to consider. Now that you know what
information to look for starting your employer 401(K) plan, you will be better
prepared to make decisions about your retirement plan. Consult a financial professional in St. Louis for help working toward achieving your financial
goals.
Sources:
Financial Health...For Now & Tomorrow
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Website - www.bogettoandassociates.com
Telephone - 314-858-1602
Email - peter@bogettoandassociates.com
10805 Sunset Office Drive, Ste. 202
St Louis, MO 63127
Website - www.bogettoandassociates.com
Telephone - 314-858-1602
Email - peter@bogettoandassociates.com
10805 Sunset Office Drive, Ste. 202
St Louis, MO 63127
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Bogetto & Associates does not provide legal or tax advice. These topics are discussed in conjunction with your CPA, Tax Advisor and Attorney.
Bogetto & Associates does not provide legal or tax advice. These topics are discussed in conjunction with your CPA, Tax Advisor and Attorney.
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