Workplace Retirement Plans and the Match

The story: Sam’s benefits packet

Sam reads a benefits packet with a manager, who points to the match and the vesting schedule.

1. Narrator: Sam just finished school and started a full-time job. The benefits packet mentions a 401(k) with a match.
2. Adult: Our example plan adds 50 cents for every dollar you put in, up to 6% of your pay.
3. Sam: So if I put in 6% of my pay, the job adds 3%? On top of my paycheck?
4. Narrator: Yes. The match is part of Sam’s pay. Putting in less than 6% leaves some of it unclaimed.
5. Adult: The match vests over time. If you leave early, you might not keep all of it.
6. Narrator: Eligible and able? Many people put in at least enough to get the full match.

What you’ll learn

1. Workplace plans

   Many jobs offer a retirement plan, like a 401(k), 403(b) or 457. Money comes out of your paycheck and is invested for later. Your plan decides when you can join, and some require an age or time on the job.

2. The match is extra pay

   With a match, your employer adds money when you put money in, up to a limit. Learn the formula and the vesting schedule. Vesting says when the match is fully yours to keep.

   Example: 50¢ per $1, up to 6% of pay. On $3,000 of monthly pay, putting in $180 adds $90 from the match.

3. Pre-tax or Roth

   Pre-tax money goes in before income tax, and you pay the tax when you take it out later. Roth 401(k) money goes in after tax. It can come out tax-free later if you follow the rules. Some jobs enroll you automatically, and you can change the amount.

4. Limits and taking money out early

   There’s a yearly limit on what an employee can put in: $24,500. Taking money out before age 59½ usually costs an extra tax, with some exceptions.

Key words

401(k)

a workplace retirement plan paid from your paycheck (403(b) and 457 plans are similar)

pre-tax

put in before income tax is taken out

Roth 401(k)

a workplace plan where money goes in after tax and can come out tax-free later

auto-enrollment

when a job signs you up for its plan unless you opt out

Common questions

What if I can’t afford enough for the full match?

Many people start with what they can and raise it over time, for example with each raise. For many, covering needs and an emergency fund comes first.

Does a part-time job count?

It depends on the plan. Long-term part-time workers have their own way in. The fact card links to the rules.

Remember this

Eligible and able? Get the full match.

Try it: Find the match

1. Use the sample plan from this lesson: 50¢ per $1, up to 6% of pay (example).
2. Find the match formula and when someone can join.
3. Or ask a working adult whether their job offers a match.

The whole mission; no account or app needed.

Live facts

Numbers that change over time, with when they were last checked and where they come from.

• 401(k) yearly limit

  $24,500

  What an employee can put into a 401(k), 403(b) or most 457 plans in a year, before catch-up

  As of 2026

  Source: IRS.gov(opens in a new tab)

• Early-withdrawal penalty ends at

  59½

  Retirement-account withdrawals before this age usually owe an extra 10% tax, with some exceptions

  As of February 8, 2026

  Source: IRS.gov(opens in a new tab)

• Who can join a plan, including the long-term part-time worker rule

  Source: U.S. Department of Labor(opens in a new tab)