What Is Amazon 401k Plan

Amazons 401 Contribution Matching System

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In 2022, you can contribute up $20,500 on a pre-tax or Roth basis into your 401, and if youre age 50 or older, you can contribute an additional $6,500. Amazon will provide you with a 50% match on the first 4% contributed, meaning that they will contribute 2% of your base salary to your 401. For example, if youre making $160,000 and you put $20,500 into your 401, Amazon will contribute $3,200 as a match .

There are two ways that employees can contribute to their regular 401:

Traditional Pre-Tax 401: Make contributions before taxes. With this option, when you withdraw savings for retirement, you are taxed.
Roth 401: Make contributions after taxes. You dont get a tax break up front, however, money withdrawn at retirement will not be taxed.

Amazon’s 401k Contributions As Compared To Other Companies

Similar to Amazon, Facebook, Microsoft, and Google match 50% of employee contributions. Unfortunately, Amazon’s maximum contribution is up to 4%, while competitors like Facebook and Microsoft offer 7% and 6%, respectively.

Facebook’s and Microsoft’s 401k vesting is immediate. With Amazon, on the other hand, you will not get your match until you stay with the company for three years. Amazon often pays out in company stocks, but employees are free to redirect according to their personal financial plan.

Check out our ranking of FAANG 401k plans for more detailed information.

Life And Accidental Death And Dismemberment Insurance

Amazon currently provides two times your annual base salary for Basic Life and AD& D Insurance at no cost to you.

You can buy supplemental life insurance coverage for yourself, payable to your designated beneficiaries if you die. You can buy coverage in amounts of 1x to 10x your base annual earnings, up to $2,000,000.
You can buy life insurance to cover your spouse/domestic partner in amounts of $25,000 or ½ to 5x your base annual salary, up to $250,000 not to exceed 100% of your total amount of life insurance .
You can buy life insurance to cover your children in certain amounts up to $20,000.

An accelerated death benefit is available in certain situations involving a terminal illness.
You can buy supplemental AD& D insurance to cover just yourself, or yourself and your eligible dependents, of 1x to 10x your basic annual earnings, up to $2,000,000.

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The Great-West Life Assurance Company, London Life Insurance Company and The Canada Life Assurance Company have become one company The Canada Life Assurance Company. Learn more

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Match Of The Top 41 Employers

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Find out how 401 match works and the 401 match of top employers such as Amazon, Google, Microsoft, CVS, and others.

A 401 plan provides a convenient way to build a nest egg for retirement. An attractive feature of 401 plans is the companyâs 401 match, which helps employees grow their savings with some free money from the employer. If your employer offers a 401 match, you should find out if you are eligible to receive the match and start collecting the benefit.

401 match of top employers averages 6% of the employeeâs eligible pay. A 2020 study by Vanguard reported that 71% of companies matched $50 cents for every $1 an employee contributed up to 6% of the eligible compensation. Only 21% of these companies match employee contributions dollar for dollar.

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Amazons 401k Match Explained

Amazon 401K: Important Things You Should Know About!

Levels.fyi · February 19, 2021

If you are a software engineer receiving your first six-figure offer from , you must be beyond excited. However, in addition to the annual base salary, at Levels.fyi, we suggest that you also pay attention and gain a thorough understanding of the full array of offered benefits and eligible compensations, including Amazon’s 401k match, sign-on bonus, and relocation benefits. Having knowledge of these will allow you to take advantage of your full compensation and negotiate better deals.

This article will answer questions on everything you need to know about Amazon’s 401k contributions and match, along with other considerations to take into account.

A Quick Guide To Maximizing Your Amazon 401

No matter where you work, its crucial to have a plan in place for when youre not workingthat is, how youll save for retirement. A significant part of this strategy for many people is their employer retirement plan. Some of the worlds biggest employers, including Amazon, make it easy to save for retirement by offering 401s.

is fairly straightforward, and were here to help you understand the basics:

But wait, theres more! Read on to get the most out of your Amazon 401.

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What Is A Good 401k Match

If your employer has a 401 match, you may be wondering how the employerâs match compares to other employerâs 401 match.

A survey by the US Bureau of Labor Statistics reported that only 56% of companies provide a 401 plan for their employees, with about half of these companies providing a 401 match. 41% of the companies with a 401 match up to 6% of the employeeâs salary, while only 10% of the companies match 6% or more of the employeeâs salary. The survey also reported a median 401 match of 3% of the employeeâs salary.

If your employer’s 401 match is above the average and median match, it means you have a good 401 match than half of 401 participants.

Employee And Family Assistance Program

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Amazon cares about your health and well-being, both on and off the job. The Employee and Family Assistance Program is available 24/7 to you and your family at no cost to help make life a little bit easier. Use the EFAP to access confidential, professional counseling and support for your health, wellbeing or work-related issues.

Maternity and Parental LeaveFollowing all local and statutory requirements, Amazon offers up to 20 weeks of paid parental leave, plus up to an additional eight weeks of flexible work time when returning to work.

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Navigating The Amazon 401 Plan

Employer Retirement Plans form the backbone of most Individual’s Savings and Retirement Plan. Where a Defined Benefit Plan used to provide retirement security via “income for life”, now most people rely upon a Defined Contribution plan for retirement security. Like most 401 Plans, Amazon’s is chock-full of bells and whistles that both entice and benefit their Employees. Any Amazon Employee would be wise to be well-versed in Amazon’s 401.

Amazon Comcast Face 401 Climate Plans Shareholder Votes

Stockholders to vote at upcoming annual meetings

401 investment options dont align with corporate rhetoric

Amazon.com Inc. and Comcast Corp. stockholders can vote on proposals to evaluate the companies 401 plans for environmentally friendly investment options, the Securities and Exchange Commission determined.

In decisions made public Wednesday, the SEC denied appeals from both companies to exclude retirement plan evaluation proposals from their upcoming annual shareholder meeting agendas.

The companies argued that 401 investment decisions are day-to-day business operations that securities laws allow companies to handle without shareholder input. But the issue brought before both companies by nonprofit shareholder advocacy group As You Sow transcends ordinary business matters usually reserved for management control, regulators said.

Workplace retirement plans are emerging as an avant-garde battlefield for socially conscious investors trying to steer companies toward ambitious operational climate goals. Environmental advocates want to square companies outward stance on climate change and social justice issues with the 401 investment lineups they offer their workers.

Amazon and Comcast are among more than a dozen major public companies the nonprofit is probing.

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How Can You Reduce Taxes With Amazon’s Mega Backdoor Roth Conversion

Mega Backdoor Roth Conversion allows you to reduce the total amount of taxes you pay.

If you are planning on saving money beyond your 401k, chances are you are going to put them in a brokerage account. With these accounts, you have to pay taxes every year.

For example, suppose you have a brokerage account. In that case, you need to pay taxes on interest income, capital gains, and interest every year, which can seriously drag your investments’ performance in the long run.

On the other hand, if you save extra money into a Roth through Mega Backdoor Conversion, you have it saved safely, while all the interest, dividends, and capital gains are tax-free.

Northrop Grumman 401k Match

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Northrop Grumman provides automatic enrollment of new employees in its savings plan.

Employees can contribute 1% to 75% of their eligible pay to their 401 plan, and receive 4% to 7% matching depending on the date when they were hired. Employees hired before April 1, 2016, get up to a 4% match of their eligible compensation. Employees hired after April 1, 2016, are eligible for 401 matching up to 7%.

Employees must complete three years of service to be 100% vested in the matching contributions.

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Should I Also Have An Individual Disability Insurance Policy

In todays economy, your most valuable asset is the human capital, which is often overlooked when discussing job opportunities and benefits.

Accounting for the fact that one in four people will become unable to work for any length of time over the course of their careers, individual DI is a cost-effective way to ensure the continuity of income.

While its possible to obtain benefits from Social Security Disability Insurance, its often not a dependable option as initial claims are frequently denied, and theres an elimination period of five months.

Given the limitations of Amazons disability insurance policies, you should consider adding an extra layer of protection by having an individual disability insurance policy as part of a comprehensive financial plan.

Heres what you should know about individual DI:

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Which Model Portfolios Is Right For You

Selecting the right portfolio is an individual decision based on your comfort and ability to take risk. Only you can decide. Planning your retirement is more important than ever. Your portfolio choice will vary based on age, income, lifestyle, other investment assets and your tolerance for risk. We believe you can take control of your 401k and plan for the retirement you envision. For help in thinking about your ability and comfort with risk, check out the short risk quiz provided by our friends at Friedenthal Financial: Risk Tolerance Quiz. No personal information is required to take the quiz. Your privacy is protected.

Remember, you must be comfortable with your investment strategy. Each of EZTracker s model portfolios are designed for different investment needs and styles. Whether youre an aggressive, moderate or conservative investor, EZTracker has a portfolio for you.

Our Philosophy

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It’s Not Realistic For Most People

For tax year 2023, the maximum contribution to a 401 plan is $22,500 . Considering the median U.S. household income is just above $67,500, it’s safe to say maxing out a 401 is unrealistic for most people — and that’s perfectly fine. The goal is to save for retirement without threatening your current livelihood.

If you can max out your 401, perfect. If you can’t, the minimum you should be contributing is the maximum amount your employer will match. If they match 3%, make 3% your minimum if they match 5%, make 5% your minimum. An employer match on your 401 is as close to “free” money as there is, and you don’t want to leave any on the table by shortchanging your contributions.

Conocophillips: 6 To 9 Percent Match

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ConocoPhillips employees can receive a 6 percent contribution if you contribute 1 percent of your salary. Additionally, Conoco offers contributions of 6 percent, 7 percent and 9 percent based on years of service and age. Employees are fully vested after three years and 1,000 hours of service each year.

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Homeowners Renters Auto And Pet Insurance

Shop for homeowners, renters, auto, motorhome/RV, or boat insurance to receive competitive price comparisons from multiple carriers. You can maximize your savings with multi-vehicle and multi-policy discounts.
Save up to 20% on pet insurance coverage. You can choose from many options to customize coverage, including:
Accident-only, in case your pet gets hurt

Coverage for illnesses, cancer, hereditary conditions, behavioral issues, dental disease, and more
Preventive care, which helps cover the cost of vaccines, screenings, dental cleanings, and more

You can enroll in or change these benefits at any time during the year not just during Open Enrollment.

Amazon Adds 401k Plan For Delivery Service Partners

Amazon today announced two new value-added services to empower its Delivery Service Partners to offer best-in-class benefits for their driversand one of them is a 401k plan.

The addition of a 401k plan to the suite of services available to DSPs comes with the carrot that Amazon is providing an estimated $60 million over the first year to help these small business owners match employee contributions.

Amazon will provide DSPs with that estimated $60 million in the first year to help offset the costs for DSPs that match employee contributions to their teams retirement savings and reimburse 100% of the administrative costs

More than 70% of DSP drivers expressed that retirement savings is a critical benefit, which is why Seattle-based said it will now offer a 401k program to U.S. based DSPs and support owners in matching contributions for drivers. Amazon will provide DSPs with that estimated $60 million in the first year to help offset the costs for DSPs that match employee contributions to their teams retirement savings and reimburse 100% of the administrative costs through a leading provider of retirement savings benefits.

The other new value-added service is a new academic program, Next Mile, which will provide drivers employed by participating DSPs with up to $5,250 per year to access more than 1,700 academic programs, including bachelors and associate degrees, skill certifications, and high school completion courses.

This Report Analyzes And Compares Amazons Employee Health Insurance And Employee Benefits With Its Industry And In Washington State

Providing a smart employee benefits package is critical for attracting top talent and retaining valuable employees. Today, employee benefits play a vital role when candidates consider accepting a job offer.

Many companies offer today over-the-top perks, like yoga classes, haircuts, catered meals, and acupuncture. In this report, we focus however on traditional benefits. Its a work in progress that we will expand and update on a regular basis.

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What Are The Rules For Accessing My Fund

If you need to utilize your funds before you leave Amazon or retire, you can either take out a loan from your 401 account or make a withdrawal.

Taking out a loan from your 401 means borrowing a sum from the account with the obligation of paying it back, with interest. To pay the loan amount back, your paycheck is reduced by the amount you borrowed plus interest. You can pay the amount back over a period of up to five years if you request a deferral. There is a minimum loan amount of $1,000, and a maximum amount of half of your vested balance in the fund .

Making a withdrawal from your 401 is permitted when you reach age 59 1/2 or when you want to withdraw money that you rolled over into your Amazon employee fund from a previous employer. Additionally, Amazon offers hardship withdrawal options if you experience serious financial hardship. Financial hardships could include medical expenses, payments to prevent foreclosure or eviction, the cost of tuition, or funeral expenses.

What Happens To You 401 If You Quit

If you leave your job at Amazon, you have a few different options for what to do with the money in your 401 plan. First, you can simply decide to leave the money where it is. You might go this route if you arent moving to a company that offers a 401 or if the plan at your new company isnt as good as the Amazon plan.

Next, you can to a 401 plan at your new company. The benefit of this option is the simplicity You only have to keep track of one retirement account, rather than keeping track of one at each of your former jobs. To roll money from a former 401 to your Amazon 401 plan, contact your plan administrator, Fidelity.

Next, you can decide to roll the money into your 401 over into an IRA. You can choose between a traditional IRA or a Roth IRA, but keep in mind that if you roll the money over from a traditional 401 to a Roth IRA, youll have to pay income taxes on the entire amount.

Finally, you can take a lump-sum distribution from your Amazon 401 plan . While this option might seem the most attractive at the moment, it should be saved as a last resort.

First, cashing out your 401 is robbing your future self of retirement funds. And since time in the market is one of the most important factors for how your investments grow, cashing out what youve saved could result in a huge cut to your retirement savings. Another downside of cashing out your 401 is that in addition to paying income taxes on the amount you withdraw, youll also pay a 10% penalty.

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