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| DC Plans Make It Easy to Save: It's Automatic |
| There's no doubt about it, saving money can be tough. But if funding your employer retirement plan is your responsibility (as it is in 401(k)s and 403(b)s), you have no choice but to save. Fortunately, if you sign up to participate in your DC plan, your company will automatically deduct your contribution from each paycheck. You won't have to remember to mail a check each month, or worry about saving up money to contribute. It will all happen automatically. |
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| This is a great way to save without trying, because you can't spend what you never had. (Well, you can, but it's harder.) It's relatively painless, and you'll be surprised at how quickly the savings in your DC plan will add up. (The reduction in take-home pay is an estimate the actual amount may differ based on your number of dependents and other tax considerations.) |
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How much can you contribute each year? Unlike the low limit of an IRA, most employee-funded DC plans let you contribute up to $ of your salary in . Your total contribution, which is the amount you and your employer contribute together, can be up to 100% of your annual salary or $ a year (whichever is less). |
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