Medliant: Now Offering A 401(k) Retirement Option For USRNs
Medliant has exciting news to share as we will now be offering a 401(k) retirement option to help you and your family prepare for a successful and prosperous retirement. As a USRN myself, I utilize my 401(k) option and feel confident that it will set my family and I up for success in our retirement years. Here is some basic information that you should know if you are considering taking advantage of Medliant’s new 401(k) retirement option:
What Is A 401(k)?
A 401(k) is an employer sponsored retirement plan offered only in the USA. A 401(k) offers a unique tax advantage as contributions to the account are made before the pay check is federally taxed, allowing you to contribute more money up front, and simply paying tax on the money you withdraw in retirement years instead. This tax advantage can exponentially help you grow your retirement nest egg and allow you to retire more comfortably. Theoretically you will be in a higher tax bracket while you are working and in a lower tax bracket when you are retired, therefor it is better to pay taxes in a lower tax bracket (during retirement) after that money has had time to compound and grow over decades.
How Do I Contribute To A 401(k) And How Often Do I Contribute?
Medliant will assist you in setting up your 401(k) when you begin working as a Medliant USRN if you choose to participate in this 401(k) retirement option. Contributions are made with each pay check by selecting a percentage of your pre-tax income to contribute. You can adjust the percentage of your contributions or pause the contributions all together at any time. From personal experience, many USRNs I have spoken to will often set their contribution rate anywhere from between 5-15% depending on their budget.
How Much Can I Contribute To A 401(k) Pre-tax?
The actual contribution amount that you choose to put into your 401(k) is up to you! You can choose to contribute any percentage of your pay check into your account as long as you do not exceed the annual employee contribution limit ($23,000 for 2024). If you are 50 years or older, you are allowed to contribute an additional $7,500 above the 2024 $23,000 limit as a “catch-up” contribution option as well.
When Can I Withdraw Money From My 401(k)?
You can begin to withdraw money from your 401(k) without penalty after 59 ½ years of age! You can withdraw money earlier with penalties and fees (this is often not advised).
What Are The Advantages Of Choosing To Use A 401(k) Retirement Option?
Tax advantages: Because the contributions are made before you are taxed federally, you will then pay less overall tax as your actual taxable income is lower. You will also likely be in a lower tax bracket during your retirement years (versus working years), which means you should likely pay less taxes on retirement withdrawals, also serving as a tax advantage.
Time is your biggest asset: The earlier you are able to start contributing to a 401(k) the more time that your money has to grow for you. According to Fidelity Investments (2023) “compounding is when your investment returns earn returns of their own. Because it puts your money to work for you, compounding returns could be a powerful way to grow wealth over many years or even decades. The potential snowball effect of compounding makes early saving or investing, particularly in tax-advantaged retirement accounts like a 401(k), that much more enticing since the earlier you start investing, the more compounded returns you can hope to make.”
Greater growth potential: Because you are contribute to a 401(k) pre-tax, you will theoretically have more money to invest in upfront versus if you had to contribute to a retirement fund after paying taxes.
No penalty for withdrawals after 59 ½ years of age: As long as you do not withdraw money before this age you will not pay any additional fees or penalties.
The 401(k) is transferable: If you choose to work for another employer in a few years, you can take your 401(k) with you as it is your money. If the new employer also offers a 401(k) retirement option, you can often transfer those funds into your new employer offered 401(k) account as well.
Easy to manage: You can simply select the percent that you wish to contribute each paycheck into your 401(k) without any further action, unless you wish to make quick and easy adjustments over time. Often 401(k) investment options are comprised of carefully management portfolio funds, which may take the stress out of having to monitor and manage individual stocks.
Disclosure: This blog post is not intended to, nor should it serve as financial or retirement advice for its readers. It is recommended to speak with a financial advisor regarding your financial goals before you make any decisions regarding your finances or retirement. This blog post serves to simply inform you that Medliant is now offering a 401(k) retirement option to Medliant USRNs, with basic information about this type of retirement savings account.
