Evaluating My Retirement Plan

Evaluating My Retirement Plan

FIN/422

Evaluating My Retirement Plan

Based on the research I did for this week’s team assignment, I really learned a great deal more about the retirement plans that my employer offers. My employer offers a noncontributory Retirement Plan (Defined Benefit) along with a 401K plan. For the defined benefit plan, retirement funds are provided for the associate and their family and the amount received is based on age, earnings, and years of service. The amount one will receive from this plan is known in advance. You become eligible for this plan after completing one year of service, be at least 21 years old or older, and have completed more than 1000 hours of work. You are entered into the plan on the first day of the month on or after becoming eligible. As for the 401K plan, you have to be at least 18 years old or older to participate. You can join the plan at any time, starting the first of the month after your first day of employment. With the 401K plan, you are able to elect how much salary you want to contribute and direct the investment of your plan account, thus meaning you can tailor it to meet your needs specifically. The company matches the amount you are putting into the 401K once you have selected at least 5% or higher. Along with the traditional 401K option offered, there is also a Roth 401K available. I really like the 401K option that my employer offers because it is a great way to save up for retirement without even thinking about the money that is being put aside to the 401K account. I also like that my employer matches if you elect to have 5% or more because then you are putting more money into your retirement 401K account. Another thing that is great about the 401K is that you can select how your investments are made, so you can choose to be conservative or risky with the money you are putting into the account. After this week, I really got to dive deeper into my employers retirement options and it makes me feel good to know that if I choose to stay with my current employer, I have some great options for my retirement funds.