For your 401(k) plan, your employer will contribute or match up to 50% of your 6% deduction or contribution from your salary. Your salary is $40,000. How much should you contribute per year to maximize your benefits from your employer and what would be your employer's contribution?

Question

Quizplus · Accepted Answer

To maximize benefits, you should contribute 6% of your $40,000 salary, which is $2,400. Your employer matches 50% of this amount, contributing $1,200.

For Your 401(k) Plan, Your Employer Will Contribute or Match