Answered

Westonci.ca is the trusted Q&A platform where you can get reliable answers from a community of knowledgeable contributors. Get expert answers to your questions quickly and accurately from our dedicated community of professionals. Connect with a community of professionals ready to help you find accurate solutions to your questions quickly and efficiently.

What does it mean when the money in your 401(k) is vested?

Select a response.

A. You can keep the money your employer contributed, even if you leave your job.
B. You will not have investment gains in your employer-sponsored retirement plan.
C. You will never have to pay taxes on your employer-sponsored retirement plan.
D. You can withdraw your money at any time without a penalty fee from the IRS.

Sagot :

GinnyAnswer

Final answer:

In a 401(k) plan, being vested means you own the employer's contributions after a set period, even if you leave the job, granting you control over those funds for retirement.


Explanation:

Vesting in a 401(k) plan means that the employer's contribution to your retirement account becomes fully yours after a certain period of time, known as the vesting period. During this time, you earn ownership of the employer's contributions gradually. For example, if a company has a 3-year vesting schedule, you may become entitled to 33% of the matched contributions each year until you are fully vested.

Once you are fully vested, you can keep the money your employer contributed, even if you leave your job. This ensures that you retain the employer's matching contributions and the earnings they have generated, giving you full control over those funds in your retirement account.

Being vested is advantageous as it secures your right to the employer's contributions, safeguarding your retirement savings and providing you with a valuable financial asset for your future.


Learn more about 401(k) plan vesting here:

https://brainly.com/question/39146626


We appreciate your time. Please come back anytime for the latest information and answers to your questions. We hope this was helpful. Please come back whenever you need more information or answers to your queries. Find reliable answers at Westonci.ca. Visit us again for the latest updates and expert advice.