401k plan

A qualified plan established by employers to which eligible employees may make salary deferral (salary reduction) contributions on a post-tax and/or pretax basis. Employers offering a 401(k) plan may make matching or non-elective contributions to the plan on behalf of eligible employees and may also add a profit-sharing feature to the plan. Earnings accrue on a tax-deferred basis.

Employer-funded pensions are usually divided into two broad categories: defined benefit (DB) and defined contribution (DC). In a DB plan, the employer promises a defined amount to retirees to pay for meeting certain eligibility criteria. In other words, the plan defines the service received to be. In its typical form, a DB plan pays a lifetime monthly benefit for retirees to meet