What is a common feature of a 401(k) savings plan?

A common feature of a 401(k) savings plan is that employers often match employee contributions up to a limit. This matching contribution is typically an incentive for employees to participate in the plan and can significantly enhance the amount saved for retirement.

Employers usually match a certain percentage of the employee's contributions, which helps employees accumulate more savings over time. This matching feature is one of the primary benefits of participating in a 401(k) plan, as it effectively provides free money that complements the employee's own savings efforts.

The other options are less accurate with respect to the characteristics of a 401(k) savings plan. Contributions to a 401(k) are made pre-tax, meaning they are not subjected to income tax at the time of contribution, but they are taxable upon withdrawal in retirement, making the first choice incorrect. Benefits are not distributed immediately upon retirement; instead, they usually become available at a specified retirement age or upon leaving employment, which rules out the third choice. Lastly, while employees can choose how much they contribute, they are not required to contribute a fixed percentage, allowing for more flexibility in their savings approach. Therefore, the matching contributions from employers are a notable and beneficial aspect of 401(k) plans, reinforcing the validity