Did you ever wonder about the history of the 401(k)? 🤔💭

free money
Posted on . 2 min read

Did you ever wonder about the history of the 401(k)? 🤔💭

🏛 Back in the late 1970s, the U.S. government faced a serious problem: with the rise of inflation and the decline of traditional pension plans, workers were struggling to save for retirement.

In response, Congress created the 401(k) to help workers set aside pre-tax dollars for retirement. The idea was that by incentivizing people to save, the government could help alleviate the burden on Social Security and other public retirement programs 💸 💰 👴

⏭ ⏭ ⏭ Fast forward to today, and the 401(k) has become a staple of the American retirement landscape. There were $6.3 trillion in assets in 401(k) accounts as of September 2022. These plans were held by 60 million active participants.

But why should you care about all of this? Well, for starters, the tax benefits of a 401(k) can be substantial. By deferring taxes on your contributions, you can potentially save thousands of dollars over the course of your career. And if your employer offers matching contributions, you're essentially getting free money that can help supercharge your savings 🚀🚀🚀

But these benefits aren’t automatic. It’s important to make sure you have your account optimized early on, so you can reap the benefits over time. With 401(k) and retirement accounts in particular, small changes made today can add up to millions of dollars in investment returns over a few decades.

Xillion’s 401(k) Optimizer analyzes and improves your portfolio in minutes by helping you compare different investment options quickly and clearly. This only takes a few minutes, but it can make the difference of whether you get to your desired financial destination or not.

Get started with a free Xillion account today, and follow us on LinkedIn for more financial learnings.

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