401(k) Plan is a retirement savings plan offered by employers in the United States. Employees can contribute a portion of their paycheck before taxes are taken out, and many employers match contributions up to a certain limit. Investments within a 401(k) can grow tax-deferred until withdrawal, usually after age 59½. While not directly tied to crypto, the concept of long-term, tax-advantaged investing often contrasts with the higher-risk strategies in digital assets.
Example:
An employee contributes 6% of their $60,000 salary ($3,600 annually) into a 401(k), and their employer matches 3% ($1,800). Over decades, compounding significantly grows the retirement account.