401(k) is a retirement plan that employers generally offer to their employees. Under the 401(k) plan, retirement plans are mostly offered through an automated deduction from employees' paychecks.
Definition of 401(k) plan
401(k) plans are retirement plans that most of the employers today offer to their employees. The way 401(k) retirement plans work is that employees are offered start saving for their retirement through deduction from their paychecks.
Benefits of 401(k) retirement plans
One of the biggest benefits for employees is that 401(k) plans allow employees to defer taxes and save for their retirements by placing before-tax dollars straight to their investment accounts.
As an employer, it is important to offer 401(k) retirement plans, as this is one of the popular Employee Value Propositions important to job seekers and employees.