Funding Your 401-K

Companies are maximizing employees' 401-K as the market rebounds.
3:26 | 12/04/11

Coming up in the next {{countdown}} {{countdownlbl}}

Coming up next:

{{nextVideo.title}}

{{nextVideo.description}}

Skip to this video now

Now Playing:

{{currentVideo.title}}

More information on this video
Enhanced full screen
Explore related content
Comments
Related Extras
Related Videos
Video Transcript
Transcript for Funding Your 401-K
Assigned some businesses are helping to bring America back by bringing that for one case put on hold during the recession. Now some businesses are not only bringing back the company match their beating it here's ABC's Chris period now. At the Motley Fool of Virginia firm that sells investment advice the holiday just got right. This company and hundreds of others are giving back what they took away during the darkest days of the recession. Matching contributions to those popular 401K. Savings plans. I think it's excellent news for the economy. 41 -- match from a company perspective is an experience but it's also an investment in the future of employees. Employees here had a stark choice. Give -- the 401K match or perhaps lose their jobs we agreed that lay offs -- going to be off the table. But in exchange for that everything else was on -- table. For millions of Americans retirement savings took a big hit during the recession stocks are still -- -- more than 20% from their peak. But now with the economy picking up employers such as FedEx Starbucks and US steel are bringing back the company -- A new study finds more than 75%. Of firms that cut back or cut out contributions. Have now restored them. Even -- the company's reinstating their 401K match that's only half of the news the other half of the news is how important it is. For employees to be saving on their own. -- most retirement plans for every 100 dollars you save your employer chips in another fifty dollars up to a certain level literally free money. One reason companies are contributing again the study finds is -- feared their employees might not save enough to retire in a timely and efficient manner. In other words to avoid an older more expensive workforce. At Motley Fool the company not only made up for the contributions it had cut. And also added 30% on top of that. To help cover any investment losses are stocking stuffer just in time for the holidays Chris -- ABC news Chicago. All right Chris Bury our thanks to you elaborate and ABC's be -- -- bullet Regan who covers the markets force great to see you in great to see these companies bringing back the 401K match. But Crist told us earlier that one in three Americans don't take advantage of the full. Company -- understandable in this economy but if you can't makes a huge difference makes such a huge difference David take a look at these. -- -- -- together let's say you're making 40000 dollars a year your forty years old and decide to contribute. 2% of your earnings your 401K by the time your retire 25 years from now -- he's bringing home 100000 dollars and 401K. 30000 of that coming to you free from your company is not what if you could put aside 6% and the company will match that it adds up a lot -- -- take a look at this number 6% -- bringing 280000. Dollars and 25 years. 100000. Dollars of that coming to you read from your company if you could pull it off. And -- on the eve of another week for the markets last week up with -- 700 points were now in positive territory for the year this is good news the question is. How do we keep the market's going in this direction all eyes once again David this -- will be focused on what happens in Europe was not a huge rally last week because of that coordinated effort by the global central banks to lower barring race. This week we're gonna see -- -- deal is indeed passed in Europe and if it is the markets like that we could see another rally. Let's hope will be watching this week unable to -- -- tonight thank you.

This transcript has been automatically generated and may not be 100% accurate.

{"id":15085292,"title":"Funding Your 401-K","duration":"3:26","description":"Companies are maximizing employees' 401-K as the market rebounds.","section":"WNT","mediaType":"Default"}