What Is A 401(K) Retirement Savings Plan?

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   Steve Savant

   Syndicated Financial Columnist, Host of the weekly talk show Steve Savant's Money, the Name of the Game, Scottsdale Arizona

   A 401(k) plan is a qualified defined contribution retirement plan under ERISA, the Employee Retirement Income Security Act of 1974. The pretax contributions accumulate tax deferred and distributions are taxable as ordinary income at retirement. Some employers also match a portion of employee contribution and those over age 50 are allowed additional contributions under the catch up rule.

   Answered on August 14, 2013

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