Depending on the way your plan is set up, your employer may "match" the amount of money you put in your plan (a.k.a. free money!) based on the amount you contribute. This can be done in a number of ways. For example, employers often match a percentage of an employee's contribution up to a certain amount. However, they may also elect to match employee contributions up to a certain amount regardless of an employee's contribution.
For example, if your employer offers a "3% match", you must contribute 3% or more into your account for them to "match" the full 3% (for a total of 6%). However, if you only put in 1% of your paycheck, your employer would only contribute 1% (for a total of 2%). You may also decide to put in more - which we encourage! In this instance, if you put in 7%, your employer will still match the maximum 3%. However, that may bring you closer to your retirement goals!
Here's how a 3% match plays out for someone making $50,000.
