You recently graduated and got a job, congrats! You start to go through your benefits package and you stumble upon the 401(k) account. You read things like matching, vesting period, and contribution limits, and you’re getting more and more confused. Should you even bother contributing? Here’s some information on the 401(k) basics and some advice. 401(k) basic terms Let’s clear up some terminology. contribution: the percentage of your salary you put into the 401(k), usually pre-tax. contribution limit: limit set by the IRS how much you could contribute per year. match: the percentage your employer will contribute to your 401(k), usually based on how much you contribute to it. For example, the employer will match 100% up to 5% of your salary, which means they will match you dollar for dollar if you contribute 5% to the 401(k). This is free money! vesting period: the amount of time it takes for

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