A fidelity 401(k) plan is a 401(k) plan that is created under the Fidelity Investments company. A 401(k) plan is a savings plan for retirement that allows employers to save money before taxes, reports Wall Street Journal.Continue Reading
Employees will not see the money that they place in their 401(k) plans taxed until the money is withdrawn later on in retirement, notes the Wall Street Journal. The 401(k) plan is a great plan for most people because it puts the employee in total control over how much money is invested. It also allows employees to choose the type of mutual funds they would like to invest their money in. These mutual funds range from bonds, money market investments, bonds and target-date funds, notes the Wall Street Journal and Fidelity Investment.
Many employers also match their employee's 401(k) plan investments, so if an employee places $50 from his paycheck into the 401(k) plan, the employer will also place $50 into the 401(k) plan. The negative aspect of the 401(k) plan usually involves the contribution limits. There are two annual limits on the 401(k) plans that limit the amount of money that can be put in each year: employee elective deferral limits and overall contribution limits.Learn more about Financial Planning