401k plan

Though the S&P 500 remains 28 percent below its October 2007 peak, employees who have stayed invested in 401(k) plans and continued to contribute have fared better. About 78 percent of them now have more money in those accounts than before the market top three years ago, according to estimates by Jack VanDerhei of the Employee Benefit Research Institute.

This would certainly seem to be the case based upon this excellent and disturbing post by Kathy Kristof-Senate Moves to Keep 401(k) Fees Hidden.

This issue needs be kept on the front burner. I fear that the Senate Finance Committee is hesitating to act on this issue out of fear that contributions from 401(k) providers will dry up. In my opinion this is the height of lawmakers putting interests of the public last.
 I encourage you to email the members of the Senate Finance Committee and ask them what they could possibly still need to "vet." Ask them to reconsider their decision and to pass a measure that mandates uniform, total, and full disclosure of ALL fees and expenses for all 401(k) plans.  No loopholes, no

Caps placed by the plan and/or IRS regulations usually limit the percentage of salary deferral contributions. There are also restrictions on how and when employees can withdraw these assets, and penalties may apply if the amount is withdrawn while an employee is under the retirement age as defined by the plan. Plans that allow participants to direct their own investments provide a core group of investment products from which participants may choose. Otherwise, professionals hired by the employer direct and manage the employees' investments.

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.

Many employers, in an effort to attract and retain talent, offer match a certain percentage of the employee's contribution. According to Starbucks "Total Pay Package" brochure, for example, the company a percentage of the first match 4% of pay the employee contributes to their 401 (k) retirement plan. The employees of the company for less than 36 months will represent 25%, 36 to 60 months duration will be a 50% similarity, 60 to 120 months receive a 75% similarity match, 120 or more months receive a 150%. In other words, an employee working at the coffee giant for over ten years earning $ 100,000 would be $ 4,000 to your 401 contribution (k) a $ 6,000 deposit to the account directly by the company (150% match on $ 4,000 contribution. ) All the employees would be deposited above the 4% threshold is not a game.
Even if you have high interest credit card debt, it is preferable to help fit in almost all cases to the maximum amount your company!The reason is simple mathematics: If you pay 20% on a credit card and your company matching you dollar for dollar (a 100% return), you will end up poorer by paying off the debt. Factor in the deferred tax profits by 401 (k) plan created, and the disparity is even greater. For more information about this topic I recommend the work of Suze Orman.
Although the topic is discussed in more detail later in this article, be aware that employers are matching contributions up to six percent of the employee's salary before tax is not included in the annual limit. For example, if you qualify, you could make a 401k contribution of $ 16,500 in 2009 and still have your employer to deposit with the first six percent of your salary, the game beyond the $ 16,500 you contributed directly would.