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In the United States, a 401 (k) plan is an employer-sponsored defined-contribution pension account defined in subsection 401 (k) of the Internal Revenue Code. Employee funding comes directly off their paycheck and may be matched by the employer.
So, is the 401k too risky for retirement like the media often says? Not at all. The real risk is that since we're all largely responsible for our own retirement, the fact of the matter is most of us aren't saving nearly enough, or when we do save we're making poor decisions with the money.
Many companies offer 401 (k) plans to employees as part of their benefits packages. These plans allow both the worker and the employer to claim tax deductions when they put money into the retirement account. Your employer must follow certain rules to be able to offer a 401 (k).