The power of employer matching: Why your salary isn’t everything.
When Emma and Josh graduated from college, they both landed jobs with similar salaries—about $60,000 a year. But there was one major difference: Emma’s company offered a 5% 401(k) match, while Josh’s company didn’t.
Emma, understanding the value of free money, contributed 5% of her salary ($3,000 a year) to her 401(k). Since her employer matched dollar-for-dollar, that meant an extra $3,000 was added to her account annually.
Josh, on the other hand, also saved 5% of his salary ($3,000 a year), but since his employer offered no match, he was on his own.
Let’s assume both Emma and Josh received an 8% average annual return on their investments.
Fast forward 30 years:
Don’t Leave Free Money on the Table
Emma ended up with twice as much saved for retirement—simply because she worked for a company that valued its employees’ futures.
Choosing a job isn’t just about salary—it’s about the total compensation package. A company that offers a 401(k) match is giving you an instant 100% return on your money before you even invest it. That’s better than any stock market guarantee you’ll ever find.
Before accepting a job offer, ask:
Does this company offer a 401(k) match?
What percentage do they match?
Do I have to wait to be eligible?
If you have access to an employer match, don’t waste it. Contribute at least enough to get the full match—otherwise, you’re walking away from free money.
Want to maximize your 401(k) and make smarter career decisions? Check out Becoming a 401(k) Millionaire for everything you need to know about building wealth for your future!