There are two 401(k) account types available: Roth 401(k) and traditional 401(k). These two are highly similar in most respects, but there are different tax rules for them. Employees may have either or both options.
A set percentage that the employee chooses is automatically removed from their paycheck and invested into the account. Generally, they’re made up of mutual funds, bonds, and stocks that the employee can pick for themselves.