What is a 401(k) and how does it work?

Retirement can be a milestone to look forward to in life — but saving enough to enjoy your golden years can be a challenge. Sixty percent of Americans worry their savings aren’t on track for retirement, according to the Federal Reserve. A 401(k) account, which is an investment plan many employers offer, is one way to grow your retirement savings through automatic deductions from your paycheck. We’ll cover how a 401(k) works and how to get started, along with contribution limits, rules for withdrawals, and the role a 401(k) can play in a healthy retirement portfolio.