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Group
Coverages 401(k) Plans
401(k)
is a section of the Internal Revenue Code that gives a special tax
break to help people save for retirement. All contributions to an
employer's 401(k) plan are made before any deductions for federal
and, in most cases, state income taxes. Employees see an immediate
tax savings and will not be taxed until they withdraw money from
the plan. (Withdrawals before the age of 59.5 are generally subject
to a 10% IRS penalty.) In addition, contributions and earnings grow
tax-deferred until they are withdrawn. This allows 401(k) accounts
to grow much faster than a taxable savings account.
A
retirement plan usually offers three basic types of investments
with different levels of risk and potential earnings: Dynamic (high
risk, high earnings), Moderate (medium risk, medium earnings) and
Conservative (low risk, low earnings). An employee can choose from
a variety of these investment options to create their own custom
investment portfolio.
If
you would like to request a quote for 401(k) Plans, please click
here.
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