401K plans are offered by companies and other employers for their employees. They allow you to save straight from your pay, without paying taxes first. The plan is a trust, and there are many kinds available. Some employers will match what their employees save, thus doubling your savings. The 401K is part of the company's overall benefits package.

401K plans make it easy to save for retirement. Your company does it for you, and it comes straight out of your check. You will save money quickly with a 401K because the company invests the money. It is also tax-free.

The 401K is a retirement plan, so the money will not be available to you until you reach a certain age. With some plans, there are options for early withdrawal, but you will end up with less money than you had originally planned.

Your employer will help you calculate your final earnings. You can figure out how much you pay each month and how much it is expected to grow. In this way, you can obtain an exact dollar amount telling you how much you will have when the time comes.

If you quit or change companies, you have several options for what to do with your 401K. Some companies will allow you to keep it there until retirement age. Otherwise, you have the option of rolling it over into an IRA, or taking a lump sum. If you choose to take the lump sum, you will have to pay taxes on it and that may reduce it significantly.

Moving the money into an IRA is called a "rollover." You can hang onto this IRA, or you may be able to put it into your new company's 401K plan. Most companies will let you do this. If you keep your IRA, you will continue to not pay taxes on it.

If you pay into a 401K retirement plan, you have certain rights that are guaranteed by federal law. Your company is required to make information about their plan available to you, and to disperse the money at the required time.

If you are currently job searching, you might want to find a company with a good 401K plan as part of its benefits. 401Ks help you save for your retirement. They also make companies more attractive to prospective employees. When you are starting at a new company, make sure you get all your questions answered about their retirement plan.