What are some of the advantages of a 401(k) Plan?
There are several advantages to saving in a 401(k) Plan. First, it offers you a disciplined way of saving as your contribution is automatically deducted from your paycheck. Each contribution made reduces the amount of taxes you pay as you are saving on a pre-tax basis. Second, your money grows on a tax-deferred basis allowing you to earn interest on the money from year to year without paying taxes until you withdraw the money. Last, you are investing your money in a variety of funds provided by your employer.
