If you have just got a 401(k) retirement plan, you might have plenty of questions about it. Some of you may not even know what retirement plans like 401(k) are. Basically, it is a way to save money for your future. There are many companies and employers who offer them to their employees. Therefore, it is one of the most common ones across the States. It might be the case you get a job offer or you quit your job.
What if you want to change your job? Will it affect your 401(k) retirement plan? The US government advises employees to do something about it. According to them, it would be best for you to move all your savings from the previous fund to the new 401(k) retirement plan. As long as it is allowed because there might be restrictions.
Another option they suggest is to take all the money from your 401(k) retirement plan and put it in an Individual Retirement account. Most people usually call it IRA. Apart from these three options, you can have a third alternative. It is true that it might not be as good as the first or the second. However, it is always better than not doing anything at all. The last option is to withdraw all your money from your retirement plan. This means you will have to pay taxes though.
Could I send some money from my salary to my 401(k) retirement plan?
In fact, you can opt for sending some money of your wage to it every month. Sometimes your employer can match part of your contributions. If for example, you decide to send 6% of your salary, your employer could send 3%. In this way, your 401(k) retirement plan is getting 9% of your salary. Anyway, it is up to you the amount that you decide to add. Besides, there are different ways to invest your money. It is a clear and defined plan to make your contributions and make some benefits.
Not all employees are going to have the same amount in their 401(k) retirement plans. It will depend upon the way they contribute to it, as well as their investment choices. Actually, there are several options to invest in. They range from shares, bonds, mutual funds, and some other options which are included in this 401(K) retirement plan. Bear in mind that sometimes you can choose if you want a riskier or more secure investment.
If you are the sort of person who does not like risk, have a look at it. However, if you want to take some risk, the benefits could be higher, as well as the money that you might lose. You can always ask for help and plans are usually set taking into account your age. Let’s not forget about the amount of money you have got to invest, which is vital too. Make the most of your 401 (k) retirement plan.