Discover the differences between a Roth 401(k) and a traditional 401(k) and how Roth 401(k) matching works, including tax ...

Every year, Vanguard surveys the companies that partner with it to offer 401 (k)s to their employees. Its 2024 report revealed that a 50% match on the first 6% of pay was the most common matching ...

But matching is optional and some employers don’t do it. Even if your employer doesn’t offer a match, there are still plenty of good reasons to max out your 401 (k) each year.

In 2024, the average employer contribution match for a traditional 401 (k) was 6.61%, according to SHRM. The average match for a Roth 401 (k) was 6.5%. Typically, two types of matching exist: ...

Take Advantage of Employer Contributions Most employees would be thrilled with a 6% raise. If you’re not taking employer-match funds, you’re essentially leaving the equivalent with your employer.

But matching is optional and some employers don't do it. Even if your employer doesn't offer a match, there are still plenty of good reasons to max out your 401 (k) each year.

Key Takeaways Many 401 (k) plans offer employer matching contributions, but some don’t. Even without an employer match, you might want to participate in a 401 (k) because of its tax advantages.

Some employers match employee contributions at a higher percentage and some include profit-sharing in the deal. A competitive 401 (k) plan should have both low fees and a good company match.

Instead of receiving $10,000 in employer-matching contributions, you would only receive the match for six months’ worth of contributions, or $5,000. Your 401 (k) would be up $23,000 for the year.

The report also identified 4% as the median 401 (k) match, though the average was slightly higher at 4.6%. Based on this, a 4% match is normal for companies that offer to make matching contributions.