Your employer likely offers a matching plan when it comes to your 401(k) contributions. The match may vary from company to company, but is generally between three to six percent of your pay. In order to get the match, you need to contribute that percentage into your 401(k) and then your employer will match that contribution to your 401(k) or 403(b) or whatever retirement plan they offer.
This is money that is free to you. It is like a three percent raise that you will not see for several more years. It is a great way to increase your retirement savings. It is also a great way to increase the amount of money you earn. Since the amount you contribute is taken out before taxes, you will never miss the money. This is a great way to save.
If you quit your job, the match will only go with you, if you are vested in the retirement program. This basically means that you have worked at your company for a certain length of time. The standard amount of time is five years. If you leave before that you will take the money you contributed with you, but you will lose the money your employer contributed for you.
Experts disagree on whether or not you should always take the match. The majority advise always contributing the amount necessary for the entire match, and then focusing your money elsewhere (paying off debt or saving for a house). Other experts advise not contributing so that you have more money to throw at your problems. The sooner you start saving for retirement the better off you will be.
