Site Title

Sub-heading text.

To determine if you are eligible, you will need to know what type of 401k plan your company offers. If the plan is considered "defined contribution," then you are likely not eligible to participate in a defined advantage strategy.

A defined contribution 401k, also known as a "salary reduction agreement," is just that—an agreement where the employer agrees to contribute a certain amount to your retirement account monthly or annually.

A defined contribution plan doesn't offer any guarantees about the fund's performance, and it should be noted that these plans may have significantly lower fees than other types of plans because there isn't a fiduciary involved in managing the funds.

It's also possible for a company to offer both types of plans, but the defined advantage strategy is typically reserved for larger companies.

Copyright 2021 Finance Informar - All Rights Reserved. Privacy Policy