Your employer more likely than not provides a perfect vehicle to attain your investment goals. In this plan, the employee elects to make a contribution to the plan on a monthly basis. One effect of making such an election is that your contribution lowers your taxable income. Money is taken directly out of your paycheck before the government assesses any taxes. Taxes are imposed on the balance of your paycheck only after the contribution is made, thereby lowering your taxable income.
Some employers choose to match part or all of the employee's contribution.
Whether your employer makes a matching contribution should not be a factor in your decision as to whether or not to participate in your employer's plan. Mutual funds are an excellent way to invest over the long term even if you have little investment experience because you are essentially relying upon someone else to do the investing for you. A mutual fund is a portfolio of stocks, usually large in number, which are selected and managed by a professional who is hired by the mutual fund company. Emerging market funds are notoriously volatile and extremely risky. They concentrate on third-world nations and developing countries such as those in the Pacific Rim and Latin America.