Debunking Common 401(k) Myths
Saturday, 16 March 2024, 10:18
Debunking Common 401(k) Myths
It's important to know the ins and outs of 401(k)s to make the most of your retirement savings. Saving for retirement in a 401(k) has a lot of benefits.
401(k) Myths You Shouldn't Believe:
- Every 401(k) comes with a match: Not all employers provide a match, necessitating alternative retirement savings strategies.
- Your plan's default investment option is your best one: Target date funds may not align with your risk tolerance or offer low-cost options.
- You'll automatically face a penalty for removing 401(k) funds prior to age 59 1/2: The rule of 55 allows penalty-free withdrawals under certain circumstances.
Saving in a 401(k) could lead to a very comfortable retirement. But it's important to fully understand how 401(k)s work and familiarize yourself with their nuances so you can make the most of your nest egg.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.