December 16, 2012

How Frequently do Employers make 401k Contributions

Recently IBM announced that they would switch to making their 401k matching contributions on an annual basis.   That saves them some money and probably helps retain some people to the end of the year.   According to a news report on the topic only 9% of employers make 401k matches on an annual basis.   My employer is one of those companies as our retirement contribution is made annually.   Its not a 401k match but instead a contribution to a separate retirement account

In the WSJ article Benefits Leader Reins In 401(k)s they have a graphic from Aon Hewitt showing the distribution of employer 401k matches.   I'm reproducing that graph here :

Source : Aon Hewitt, WSJ

As you can see the vast majority of employers simply make the matches along with your regular paycheck.   However a minority of employers like IBM and my company make matches at different periods.


Blog Widget by LinkWithin