What is Our 401k Plan?

 
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The 401k perk that gets all the headlines is the employer match.  TVRH will match your contribution, dollar-for-dollar, up to the first 3% and 50-cents-on-the-dollar up to 5%. 

Contributions to a 401k plan are taken out of your paycheck before the IRS takes its cut, which supersizes each dollar you save. Let’s say Uncle Sam normally takes 20 cents of every dollar you earn to cover taxes. Saving $800 a month outside of a 401k requires earning $1,000 a month — $800 plus $200 to cover the IRS’ cut.  With a 401k, the entire $1000 goes right into the plan, where it can be invested and work for you to earn more dolla dolla bills y'all!

Besides the boost to your savings power, pretax contributions to a 401k have another nice side effect: They lower your total taxable income for the year. For example, let’s say you make $30,000 a year and put $10,000 into your 401k. Instead of paying income taxes on the entire $30,000 you earned, you’ll only owe on $20,000 of your salary. 

Adapted from Nerdwallet.com

 
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Employer Match

TVRH matches your contribution 100% up to 3% of your earnings.  We then match 50% on an additional 2%.  That means that if you earn $1000 and contribute 5% of your earnings to your 401k, you would be putting $50 into your account and TVRH would be putting in an additional $40.  Now, lets say you decide to contribute 8% of your $1000 to your 401k, you would then be putting in $80, but TVRH would still only be putting in $40. 

 

 
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Vesting

What is vesting you say?  Basically it's the process of the money that is put into your 401k, actually becoming YOUR money.  Any money you contribute is always 100% vested, meaning it's 100% yours all the time.  Now, the money that TVRH puts in to your account is a little bit different.  The 3% match is a Safe Harbor contribution, which means it's also 100% yours right away.  The match over 3% is 50% vested after 1 year and 100% vested after 2 years.  
 

 
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Withdrawals and Loans

Under certain circumstances you may be able to withdraw money or take out a loan from your vested funds.  These both come with restrictions, but are options in situations of financial hardship.