These Aren't Your Parents' Taxes (Part 6) — 401(K)

The Top 10 Things for 18-25 Year-olds to Know About Taxes

7)  401(K)

These days, you’re lucky if you’re working for a company that provides you with a 401(k) plan. A 401(k) is a retirement plan that you can contribute to so you have money when you’re old and gray—and who knows if there will be any social security left over for you?  If you’re a teacher, it’s called 403(b) plan.   Also, if your income is less than $26,500 you might get a retirement saver’s credit of up to $1,000 for contributions to your 401(k) or 403(b). You can’t be a full time student to get this credit.  This type of retirement plan is fantastic because it gives you some input into how the money you’re contributing is being invested and growing.  Talk to your human resources department if you want to get more involved in where your money is going.

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