What is a 401k match vesting schedule?

By
7 years ago

Many companies that offer a matching contribution do so with a vesting schedule, which can be seen as a retention incentive. The money you put into your retirement plan account is always yours and can’t be taken away, but the company match is gradually yours, based on how long you stay with the company.

One example of a vesting schedule is 20% after 1 year, 40% after 2 years, 60% after 3 years, 80% after 4 years, and 100% after 5 years. Contact your HR department to ask for your plan document or “summary plan description” (SPD), which contain  the details about your company’s vesting schedule, if your company offers a match, as well as other plan details, including eligibility.

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