For starters, it's important to remember that a 401(k) in and of itself is not an investment. It's more like a box or a wrapper that contains investments for its participants to choose from.
But before you get to the point of picking the investments offered by your plan, you have to figure out what percentage of your paycheck will go into your 401(k) account. Because those contributions are made pretax, the more you sock away, the more you reduce your taxable income and, in turn, your tax bill.
"Some people might not appreciate stuff like the growth of their money or that this is [a way to save for] retirement, but it's the tax break that gets them," Genkin said.
The pretax contribution limit for 2017 is unchanged from last year: $18,000 for workers under age 50 and $24,000 for people age 50 or older (the extra $6,000 is called a "catch-up" contribution). Uncle Sam won't collect taxes on this money or associated earnings until you make withdrawals, at which point they are subject to your then-current tax rate.
Financial advisors say it's also important to know whether your employer makes a matching contribution to your 401(k). Some employers will match dollar for dollar; others will give you a percentage of your contributions (say, 50 cents for each dollar you put in) up to certain amounts.
"It's free money," said CFP Robert Schmansky, a personal financial advisor and founder of Clear Financial Advisors. "It could be an immediate 50 percent or 100 percent return on your contributions."
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Advisors say that some people mistakenly think the Internal Revenue Service contribution limits include employer matches.
"Those limits are only the employee's tax-deductible limit," said Genkin of My Financial Planner. "That doesn't have anything to do with an employer match."
The employer match sometimes comes with stipulations that you must be at the company for a certain number of months or years before that match vests, which is when the employer money is yours to keep.
Sometimes the vesting schedule is gradual, meaning a certain percentage of the employer match becomes yours after a set time (say, 50 percent vested after two years on the job) and then fully becomes yours at another set time.
Advisors also stress that even if you leave a job before the company match vests, the contributions that come from you are always yours to keep, regardless of how long you worked there.
"Sometimes people think they shouldn't bother investing in their 401(k) because they won't be at that company for the long term," Genkin said. "But it matters to start saving for retirement early, even if you don't think you'll be at the job for a long time."