1. Apply What You've Learned Managing Your Employer's Retirement Plan Scenario: You are 23-years-old and working in the marketing department of a medium-sized corporation. You are earning an annual salary of $45,000 paid every two weeks. Your employer provides a 401(k) plan, and matches employee contributions by 50% up to a maximum of 3% of your annual salary. You are in a 25% marginal tax rate. Read each of the statements below and indicate whether it reflects an advantage associated with investing in a tax-sheltered retirement account. An Advantage Not an Advantage Statement You have the flexibility of borrowing from your retirement account. By being able to make contributions with pre-tax income, you have additional funds with which to make larger deposits. Taxes are due immediately, so you have the benefit of knowing what tax rate will be applied to your account. The maximum dollar amount your employer will contribute to your 401(k) account this year is $1,350 Assume that you contribute 7% of your gross income to your 401(k) account. How much will you retirement account? nnually and per pay-period to your $52 $525 and $158, respectively $225 $135,000 $3,150 and $525, respectively $3,150 and $121, respectively $3,150 and $263, respectively $135,000 and $131, respectively