How 401Ks Work?

Contributing to a 401K plan but not sure how it works? Well, the great site HowStuffWorks.com has a great “how article” on How 401(k) Plans Work.

The site, known popularly as a great book from the early 90’s has thousands of articles on how everything works, not just those mechanical devices you always wondered about before. The article called “How 401K plans work” points out the basics to 401K plans and compares them to straight-up old fashioned buying of stocks.

Some of the key elements of the article that make it worth your look are:

1. A list of 4 things that make 401K plans different from other retirment plans.

2. A great chart, pictures always work better, on how the 401K process works.

3. 401K vs. Stocks, your tax advantages and differences

Overall it’s a great article and if you’ve ever wondered where you money is going I would head over to that article to find out.

technorati tags:401K, Roth, IRA, Traditional, Retirement, Investing