Answer:
-an employer sponsored retirement plan that allows a worker to save for retirement while deffering income taxes on the saved money or earnings until withdrawal.
Explanation:
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A 401(k) retirement plan is a retirement plan sponsored by the employer where he or she deducts a small percentage of the gross pay of the employee.
What is the significance of the 401(k) retirement plan?A 401(k) retirement plan can be referred to or considered as a plan where the employer contributes a fixed and a small proportion from the gross pay of the employee until the time he or she serves to the company of the employer.
An employee is free from paying any kind of taxation amount over the monies he or she has saved in a 401(k) retirement plan. However, the taxation is not a liability only until the employee makes a withdrawal.
Therefore, the significance regarding a 401(k) retirement plan has been aforementioned.
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