It is a function of costs and expectations. Let us help you evaluate your alternatives. Regardless of which investment structure is selected, employee education is ultimately the single most important function to the overall success of the plan. The most effective employee education and plan communication results when these processes are part of the overall delivery of services, such as those provided under a packaged arrangement. Return to top.
Employers usually offer a matching contribution, tied to the employee elective salary deferrals.
A matching contribution increases the number of participants and the dollars they defer. The more the lower paid employees defer, the more the highly paid employees will benefit. Taxes are not paid until a distribution is made. Employees who are age 21 who have completed one year of service must generally be eligible to participate. Certain employees may be legally excluded, such as employees covered by a collective bargaining agreement.