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Most large companies encourage employees to save by matching their contributions to a 401 (k) plan. The government limits how much you can save in
Most large companies encourage employees to save by matching their contributions to a 401 (k) plan. The government limits how much you can save in these plans, because they shelter income from taxes until the money is withdrawn during your retirement. The amount you can save is tied to your income, as is the amount your employer can contribute. The government will allow you to save additional amounts without the tax benefit. These plans change from year to year, so this example is just a made-up "what if." Suppose the Quality Widget Company has the savings plan described in Table 8.12. Create a function that finds the total yearly contribution to your savings plan, based on your salary and the percentage you contribute. Remember, the total contribution consists of the employee contribution and the company contribution. Most large companies encourage employees to save by matching their contributions to a 401 (k) plan. The government limits how much you can save in these plans, because they shelter income from taxes until the money is withdrawn during your retirement. The amount you can save is tied to your income, as is the amount your employer can contribute. The government will allow you to save additional amounts without the tax benefit. These plans change from year to year, so this example is just a made-up "what if." Suppose the Quality Widget Company has the savings plan described in Table 8.12. Create a function that finds the total yearly contribution to your savings plan, based on your salary and the percentage you contribute. Remember, the total contribution consists of the employee contribution and the company contribution
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