401k Match: How Employer Contributions Boost Your Retirement Savings

When your employer offers a 401k match, a contribution your employer makes to your retirement account based on how much you put in. Also known as employer match, it’s one of the easiest ways to grow your retirement savings—literally free money you’d be leaving on the table if you skip it. If your company matches 50% of your contributions up to 6% of your salary, that means for every dollar you put in up to that limit, they add 50 cents. If you earn $60,000 and contribute 6% ($3,600), your employer adds $1,800. That’s a 50% return on your money before you even invest it.

Not all 401k match plans are the same. Some offer a full dollar-for-dollar match up to 3%, others go 100% up to 4%, then 50% on the next 2%. The key is knowing your plan’s formula. If your employer matches only after you’ve saved 5%, then saving 4% gets you nothing. You need to hit the threshold. And don’t assume the match is automatic—some plans require you to enroll or adjust your contribution rate each year. Your retirement savings grow faster when you’re getting that match, but it only works if you’re contributing enough to qualify.

Think of your employer 401k contribution as a bonus you don’t have to earn. It’s not a raise, it’s not a bonus check—it’s money going straight into your retirement account, often with tax advantages. Even if you’re just starting out, putting in enough to get the full match is smarter than paying off low-interest debt first. That match is a guaranteed return, no market risk. And if you leave your job, you usually keep it—all of it—once you’re vested. Vesting schedules vary, but many companies vest immediately or within a year. Check your plan documents. If you’re in your 20s or 30s, that match compounds over decades. A $2,000 match today could grow to over $20,000 by retirement, even with modest growth.

Many people miss out because they don’t know how much to contribute, or they think they can’t afford it. But even 1% of your salary can trigger a match. Start small. Increase it by 1% every six months. Automate it. You won’t feel the money leaving your paycheck if you set it up before payday. And if your employer doesn’t offer a match? That’s a red flag. Compare job offers—not just salary, but retirement benefits too. A 6% match on a $70,000 salary is worth $4,200 a year. That’s like a $4,200 raise with no extra work.

Below, you’ll find real breakdowns of how different companies structure their matches, what happens when you change jobs, and how to make sure you’re not leaving money behind. Whether you’re new to work, switching jobs, or just wondering why your 401k isn’t growing faster, the answers are here.