What is Employer Match?

An employer match is when your company contributes money to your 401(k) based on your own contributions. A common formula is "dollar-for-dollar up to 4% of salary." If you earn $60,000 and contribute 4% ($2,400), your employer also puts in $2,400 — that's $2,400 of free money. Not contributing at least enough to get the full match is literally leaving money on the table. Matches may vest over 3-6 years, meaning you only keep the full match if you stay with the employer long enough.