Poll: 401K Match

Discuss all general (i.e. non-personal) investing questions and issues, investing news, and theory.

What does your employer match?

I have no employer-sponsored defined contribution retirement plan
8
3%
I have no employer-sponsored defined contribution retirement plan
8
3%
My employer's program has no match (military TSP for example)
39
14%
1:1 match of first 1-6% of my salary that I contribute
121
44%
1:1 match of first $1-$10K I contribute
5
2%
1:1 match of all the money I contribute
6
2%
1:1 match of all the money I contribute
6
2%
2:1 match of all the money I contribute
6
2%
My employer gives a defined contribution no matter how much I put in
26
9%
Other (explain below)
51
18%
 
Total votes: 276

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White Coat Investor
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Poll: 401K Match

Post by White Coat Investor » Sun Feb 03, 2008 2:15 pm

I recently learned a brother-in-law has a 200% match on his 401K. I am curious as to what the match is on most 401Ks. I'm sure some of the choices on this poll will be poor, but I think it might be interesting anyway. Try to fit yourself into a category, if you don't, then pick other and explain below.
1) Invest you must 2) Time is your friend 3) Impulse is your enemy | 4) Basic arithmetic works 5) Stick to simplicity 6) Stay the course

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Cosmo
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Re: Poll: 401K Match

Post by Cosmo » Sun Feb 03, 2008 2:23 pm

EmergDoc wrote:I recently learned a brother-in-law has a 200% match on his 401K. I am curious as to what the match is on most 401Ks. I'm sure some of the choices on this poll will be poor, but I think it might be interesting anyway. Try to fit yourself into a category, if you don't, then pick other and explain below.
With all due respect, any possibility that your brother-in-law is fibbing a little here? This is something that I have never heard of.

Cosmo

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White Coat Investor
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Re: Poll: 401K Match

Post by White Coat Investor » Sun Feb 03, 2008 2:25 pm

Cosmo wrote:
With all due respect, any possibility that your brother-in-law is fibbing a little here? This is something that I have never heard of.

Cosmo
Sure. I also got the info from my sister so that adds another layer in the telephone game. Personally, I think most 401Ks for reasonably well=compensated employees should work this way. You put in your 15K and the employer puts in his 30K and you reach the IRS limit.
1) Invest you must 2) Time is your friend 3) Impulse is your enemy | 4) Basic arithmetic works 5) Stick to simplicity 6) Stay the course

zak42
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Post by zak42 » Sun Feb 03, 2008 2:25 pm

50% of the first 6800, but its calculated and distributed quarterly, so I have to make sure to spread out the contributions over the year.

Eric White
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First 3%

Post by Eric White » Sun Feb 03, 2008 2:30 pm

My employer only matches up to $3k max.

My wife's employer only matches up to $4k max.

Thanks.
-Eric

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nisiprius
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Post by nisiprius » Sun Feb 03, 2008 2:33 pm

25% of the first thousand dollars. And I think it takes five years to vest.

"Be still, my heart."

Still, this is by far the best place to work at I've ever worked. The 401(k) match isn't exactly its best feature, though.
Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness; Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.

MattBrennan
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Post by MattBrennan » Sun Feb 03, 2008 2:38 pm

My employer provides a 50% match up to a 6% employee salary contribution. I contribute 10% of salary so I'm getting an additional 3% from my employer. The employer contributions vest after a year.

Matt

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karadad
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Variable Match

Post by karadad » Sun Feb 03, 2008 2:41 pm

My company's 401k program was enhanced last year (very good now). This is a S&P 500 corp. Fixed match is 50% of employee contribution, up to employee's 5% contribution level (i.e. fixed match is 2.5% max). Depending on yearly net income, supplemental or "bonus" contributions are possible. For 2007, company contribution will be more than 1:1 (a very good year). I thought a 50% match was relatively common for many companies; why is that not a choice in the poll?
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LH2004
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Re: Poll: 401K Match

Post by LH2004 » Sun Feb 03, 2008 2:43 pm

Cosmo wrote:
EmergDoc wrote:I recently learned a brother-in-law has a 200% match on his 401K. I am curious as to what the match is on most 401Ks. I'm sure some of the choices on this poll will be poor, but I think it might be interesting anyway. Try to fit yourself into a category, if you don't, then pick other and explain below.
With all due respect, any possibility that your brother-in-law is fibbing a little here? This is something that I have never heard of.
It's not so crazy, especially if it's capped. Some employers give 10% of salary or more in non-matching contributions; a 200% match limited to the first 5%-of-pay in contributions is less generous than that.

At one large, heavily unionized company I know of, the structure is something like: 600% match on the first 1%, then 100% on the next 5%.

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Doreamon
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Post by Doreamon » Sun Feb 03, 2008 2:47 pm

50% match on the first 6% contribution, and it is vested immediately. So, I am getting 3% free cash each year.

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NAVigator
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Post by NAVigator » Sun Feb 03, 2008 2:48 pm

My employer matches at three-fourths up to 8% contribution. So, I just checked 1:1 up to 6% since it amounts to the same match.

I suspect "other" will win. There are many variations out there as the preceding replies indicate.

Jerry
"I was born with nothing and I have most of it left."

livesoft
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Post by livesoft » Sun Feb 03, 2008 2:50 pm

My former employer put 15% of salary into the 403(b) no matter what you did.

Current one puts in 2% no matter what. Lots of employees just use a Roth IRA and do not contribute to the 401(k) plan.

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White Coat Investor
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Re: Variable Match

Post by White Coat Investor » Sun Feb 03, 2008 3:07 pm

karadad wrote:I thought a 50% match was relatively common for many companies; why is that not a choice in the poll?
Mostly because the poll designer isn't very smart.
1) Invest you must 2) Time is your friend 3) Impulse is your enemy | 4) Basic arithmetic works 5) Stick to simplicity 6) Stay the course

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dlpmpls
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Post by dlpmpls » Sun Feb 03, 2008 3:15 pm

Mine matches 50 cents on the dollar on the first 7%, so I contribute 7% :D but then my employer charges me a 1% RIA fee for which for which a Dumb A** comes in once a year to promote the actively managed funds which have an ER of 1.05% while only paying lip service to the 3 index funds with an ER of .56%. If I don't agree with how great my employers plan is I'm labeled a trouble maker. Could be worse though I could have no match at all or no plan at all.

Dan
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tgorczynski
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Post by tgorczynski » Sun Feb 03, 2008 3:19 pm

I get an automatic 1.5% (under 30), 3% (30-39), or 4% (40+) no matter what I put in.

My employer matches my contributions 100% up to 5%.

The best part is that they have Vanguard as one of the two options (TIAA-CREF is the other).

All contributions vest immediately.
Last edited by tgorczynski on Sun Feb 03, 2008 3:30 pm, edited 1 time in total.

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dingky
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Post by dingky » Sun Feb 03, 2008 3:25 pm

Employer matches half of the first 6% of pay that the employee contributes, calculated per check (if employee hits IRS maximum mid-year, then employer match stops mid-year).

Five year vesting (20% per year) from date of employment.

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House Blend
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Re: Poll: 401K Match

Post by House Blend » Sun Feb 03, 2008 3:34 pm

I get a 2:1 match for 5%. Anything above that is not matched.

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RobertH
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Post by RobertH » Sun Feb 03, 2008 4:31 pm

It might be worth knowing that complicated regulations govern 401(k) plans. Notably, highly compensated employees (HCEs) can't dominate the plan. If they do, money that HCEs have contributed might have to be given back to them at the end of the year until certain equity tests are met.

A way around this is for an employer to adopt a "Safe Harbor 401(k) Plan". By doing so, these equity tests do not apply.

If the employer adopts a Safe Harbor plan, one of the following matching contribution requirements apply:

1) 3% of the salary of all eligible participants must be paid to all eligible participants, OR
2) the employer must match 100% of participating employee salary deferrals up to 3% and 50% between 3% and 5%, OR
3) An optional formula where the employer matches at least 100% of salary deferrals up to 4%.

These contributions must be fully vested when made. There are also upper limits on how much can be contributed. More info can be found on the internet. This site explains some of the details.

Employers can be more creative and adopt other plans if they can pass the equity tests.

Robert

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snipe
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Post by snipe » Sun Feb 03, 2008 4:40 pm

6% 1:1 no matter how much it comes out to. Of course they pay me in peanuts.
Last edited by snipe on Sun Feb 03, 2008 4:40 pm, edited 1 time in total.

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jeff mc
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Post by jeff mc » Sun Feb 03, 2008 4:40 pm

other... 35% match up to 6% contribution

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aainvestor
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Post by aainvestor » Sun Feb 03, 2008 4:41 pm

100% of the first 3%
50% of the next 3%


and 3% of pay in our Non-Contributory Retirement plan (money they give each employee not covered by a pension even if they dont contribute on their on to the 401k)

Thats a max of 7 1/2% of salary match.

Wagnerjb
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Post by Wagnerjb » Sun Feb 03, 2008 4:44 pm

I work for a large energy company and we have an attractive 401k plan. The employee only needs to contribute something like 1.5% to be eligible for the "match". The match is targeted at around 7 or 8%, but it is variable depending on company performance. The match has been in the low teens the last several years, and hasn't been below the target since the plan was changed to this format a half dozen years ago. (Before adopting this plan, my company had a 1-for-1 match up to 6% along with a profit sharing formula that provided extra contributions to the 401k plan when the company met certain goals).

There are two key differences in this plan as compared to many plans. I guess the "match" isn't as guaranteed, but I suspect times would need to be very tough to see a truly low match. The second difference is that the incentive is taken away from the employee. He or she isn't induced to contribute more in order to get the match. The company will say that this program provides a match for the lower-paid employees that (for some reason) don't contribute to typical 401k plans. They only need contribute a truly nominal amount, and they get nearly 10% in savings.

To some extent, this plan is a blend between a tradional match and a profit sharing style plan.

Best wishes.
Andy

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roymeo
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Post by roymeo » Sun Feb 03, 2008 5:17 pm

My first job out of college (dot-com in Iowa) did a 2:1 match up to 4%.

Not that uncommon in some industries.

My spouse just left a small private school* that did a stragiht 1:1 up to 3%, and now works for a large non-profit that does sometihng like 13% after 1 year, period. (Though after reading the fine print it's billed more like 5%, with a company optional that's come in around 8%, but they've never missed it so far.)

My current company doesn't match but claims they pay all the hidden fees, but of course I asked about ER, they said sure they cover that, too, but no one knew what it really was and how they would pay that separately for me somehow. :) Took me a while to be convinced that you-all were right and my co-workers/benefits consultant we're more earnest than anything.


roymeo

* you think public schools have problems? you should see what happens in some of the private schools!

2017 update: That 'current' company got bought and the new 401K had some sort of matching, 4% or so. Then the next job at a large tech company, first as a contractor-through-agency without matching then real employee with matching of 3%. And now current small tech company with "4% up to $1200".
Last edited by roymeo on Thu Jun 15, 2017 3:39 pm, edited 1 time in total.
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gary11
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Re: Poll: 401K Match

Post by gary11 » Sun Feb 03, 2008 5:25 pm

EmergDoc wrote: Try to fit yourself into a category, if you don't, then pick other and explain below.
For first 3% contribution, my company matches 100%. Then for next 2% it matches 50%. So against my 5% I get 4%, basically a 80% overall match. I'm into Vanguard Target 2035 fund, with extra added 1.5% fees.
For wife's employer, they match 50% of first 6%. They have some Vanguard funds with little lower fees than what I have.

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9Iron
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Post by 9Iron » Sun Feb 03, 2008 5:44 pm

My company has a unique approach. 5:1 match on the first 1%.

There is also a supplemental match after 10 years of service.

Nitsuj
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Post by Nitsuj » Sun Feb 03, 2008 6:02 pm

MattBrennan wrote:My employer provides a 50% match up to a 6% employee salary contribution.
In my experience, this is the normal match level. 1:2 up to 6%. I have had this at several employers, often with a 3-5 year vesting schedule.

ruud
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Post by ruud » Sun Feb 03, 2008 6:15 pm

FWIW, my employer matches 50% of all contributions.

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aainvestor
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Post by aainvestor » Sun Feb 03, 2008 6:22 pm

aainvestor wrote:100% of the first 3%
50% of the next 3%


and 3% of pay in our Non-Contributory Retirement plan (money they give each employee not covered by a pension even if they dont contribute on their on to the 401k)

Thats a max of 7 1/2% of salary match.
I will have to say that my company lowered its NCRP from 4 1/2% to 3% because our competition has been lowering their matches and contributions so that could be a bad thing.

S&L1940
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Post by S&L1940 » Sun Feb 03, 2008 10:43 pm

25% of the first 5% of contribution

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Diver
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Post by Diver » Sun Feb 03, 2008 10:48 pm

dlpmpls wrote:Mine matches 50 cents on the dollar on the first 7%, so I contribute 7% :D
Dan,

If you contribute 7% of your salary and not the total compensation then you might leave some money on the table. At least that's the case in my company, the match percentage is of all the total compensation, not just salary, so it's better to contribute a little bit more in case you get a bonus.

For example if you make $100k and contribute 7% ($7K) then you will receive $3.5K match. However, if you get $20K bonus, then your total compensation for the year is $120K and match of 50 cents on ther dollar on the first 7% of $120K is $4.2K instead of $3.5K

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greg24
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match

Post by greg24 » Sun Feb 03, 2008 11:02 pm

My 403b requires that we contribute 5%, and matches 10%. We have the option to contribute more than 5%, with no match on the additional contribution. So it is similar to the original poster's brother-in-law.

MERobison
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Post by MERobison » Sun Feb 03, 2008 11:30 pm

Our 401k changed for this year, with the intent of eliminating all the old various plans the employer was sponsoring. So now, we get the first 2% automatic from employer, and then up to the next 6% match 1:1. So, assuming i put at least 6% in, I get 8% from employer.

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dingky
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Post by dingky » Sun Feb 03, 2008 11:36 pm

Diver wrote:If you contribute 7% of your salary and not the total compensation then you might leave some money on the table. At least that's the case in my company, the match percentage is of all the total compensation, not just salary, so it's better to contribute a little bit more in case you get a bonus.
It appears companies have differing calculation methods. My company applies the match to any pay that shows up on the paycheck, regardless of whether it is normal salary, paid vacation, paid holiday, overtime, bonus, or whatever else is applicable to the individual. Bonuses show up in a paycheck. Money would be left on the table only if you hit the maximum contribution amount too early in the year.

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NateH
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Post by NateH » Mon Feb 04, 2008 12:15 am

Other:
1:1 match up to 3%, vested immediately.
My wife's is 50% match up to 6%, vested immediately.

If we're contributing at least 6%, we both get the same deal.

james22
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Post by james22 » Mon Feb 04, 2008 6:17 am

1:1 to 9%

Plainsman
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Post by Plainsman » Mon Feb 04, 2008 6:54 am

Equal partner in LLC, so essentially self-employed.

No "employer match" per se, but contribute the maximum on a pre-tax basis to self-directed 401K and profit-sharing plan ($46,000 for 2008)

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iceport
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Post by iceport » Mon Feb 04, 2008 8:21 am

With a government job, there's no 457 plan match for me. (That was my response.)

My better half's employer matches 50% of the first 6% contributed (a maximum of 3%). Can't complain about a free 3%, but it's not nearly as generous as some other people's plans.

--Pete

Parrot Head
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Post by Parrot Head » Mon Feb 04, 2008 8:36 am

Other.

3 to 1 match for the first 2% of salary contributed.
"I don't mind coming to work, but that eight hour wait to go home is nonsense."

snowbound
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Post by snowbound » Mon Feb 04, 2008 9:10 am

4% match and it is deposited every other week into account.
"When someone you love becomes a memory, the memory becomes a treasure"

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Kenkat
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Poll

Post by Kenkat » Mon Feb 04, 2008 9:26 am

Not the best poll. My employer matches 50% up to 6%. This is a very common setup but is not reflected in your poll. In scanning the responses, I see many 50% match posts.

Ken

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mas
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Post by mas » Mon Feb 04, 2008 9:43 am

Ditto 50% of first 6%.

gkaplan
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Post by gkaplan » Mon Feb 04, 2008 9:53 am

I have a Thrift Savings Plan. I have an Agency Automatic (one percent of my salary) contribution and a Matching Contribution (four percent of my salary). I'm always confused how to state this, not only for this poll but also for retirement calculators.
Gordon

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astroturf
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Re: Poll: 401K Match

Post by astroturf » Mon Feb 04, 2008 10:01 am

EmergDoc wrote:I recently learned a brother-in-law has a 200% match on his 401K.
Are they matching in company stock exclusively?

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Kenster1
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Post by Kenster1 » Mon Feb 04, 2008 10:23 am

Me: 25% company match up to 6% of salary

Wife: 50% company match up to 6% of salary
(her company's match comes in the form of company stock)
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jh
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Post by jh » Mon Feb 04, 2008 11:27 am

...
Last edited by jh on Tue Feb 05, 2008 10:24 am, edited 1 time in total.

thmitch
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Post by thmitch » Mon Feb 04, 2008 12:12 pm

My employer has no set match. The match occurs at the end of the year and is based how good profits were for the year.

Terry

diasurfer
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Post by diasurfer » Mon Feb 04, 2008 12:45 pm

50% up to 4%.

very common, would have made a good poll entry. Instead I picked 1:1.

Buckeye
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Post by Buckeye » Mon Feb 04, 2008 12:58 pm

100% of first 5%....for now.


Used to be 100% of first 8%. But that changed right after I got hired. :( The word is it might get dropped to 100% of first 3% since that is what the market is saying they can get away these days....even though teh bigwhigs are enjoying better and better compensation packages.

frank_davis
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A recommendation for a follow up poll to this one.

Post by frank_davis » Mon Feb 04, 2008 1:06 pm

As the majority will fall into this category:
1:1 match of first 1-6% of my salary that I contribute

A follow up poll may divide this up to see how this is distributed.
Many companies match at 3%, but those without pension plans sometimes match at 6%.

Frank.

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runthetrails
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Post by runthetrails » Mon Feb 04, 2008 1:21 pm

Employer matches up to 3.5% of salary as follows:

100% match for the first 1% of salary
50% match for the next 5% of salary

100% vested after 1 year.

This is a big improvement as of this year... for many years it was 50% match to a maximum of $500.

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