401(k)

English

Etymology

From section 401(k) of the US Internal Revenue Code, which provides for such accounts.

Pronunciation

  • IPA(key): /fɔɹ.oʊ.wʌn.keɪ/

Noun

401(k) (plural 401(k)s)

  1. (US) A tax-qualified, defined-contribution pension account.
    • 2005 March 1, Penelope Wang, “A 401(k) of Your Own”, in CNN Money‎[1]:
      Entrepreneurs have responded enthusiastically: Solo 401(k) assets now stand at $2.5 billion, and could hit $90 billion by 2012.
      It's easy to see why the plans are becoming so popular. As with ordinary 401(k)s, as well as SEP-IRAs designed for the self-employed, individual 401(k)s allow you to invest a portion of your income on a pretax basis—and your contributions grow tax-deferred.
    • 2008 January–February, Steve Calechman, “5 Things You Can Stop Worrying about (And 5 Others that Should Trouble You Deeply)”, in Men's Health, volume 23, number 1, →ISSN, page 148:
      Contribute 10 percent of your salary each month to your 401(k), and you're good. Start at age 25 making $50,000 a year, and earn a 3 percent annual raise until retirement.
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