Business

Beware of the End-of-Year 401(k) Match

IBM was criticized in late 2012 when it adopted a last-day rule,
IBM was criticized in late 2012 when it adopted a last-day rule,Toby Talbot/Associated Press

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AOL’s chief executive Tim Armstrong drew plenty of attention earlier this month when he seemed to attribute a change in the company’s 401(k) plan in part on a couple of employees whose infants required expensive care. But what was mostly lost in the discussion was just how much it would cost employees if every employer tried to do what AOL did.

The answer? Close to $50,000 in today’s dollars by the time they retired, according to calculations that the 401(k) and mutual fund giant Vanguard made this week. That buys a lot of trips to see the grandchildren — or scores of nights in a nursing home.

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