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Contribution Increases

Work retirement plans are usually set up so your contribution is taken as a percentage of your salary. For example, if you make $50,000 and elected to contribute 5% to your 401(k) plan, your contributions will add up to $2,500 per year. A contribution increase would mean you decide to contribute a larger percentage of your income. … Continued

Roth 401(k) vs. 401(k)

Traditional 401(k) Contributions are made on a pretax basis: an employer takes money out of a paycheck and transfers it in the employee retirement plan before withholding taxes. When the employee begins to take distributions, he/she will pay normal income tax on those distributions, and the income tax will be based on the employee’s tax … Continued