Free Money

Investing in your company's 401(k) plan is the easiest way to work toward your retirement investment goals. Not only will you be saving for your retirement, you'll also be able to take advantage of your employer's contribution matching program. Most employers reward 401(k) contributions by adding their own contributions to your account whenever you put some of your money in. That's free money for you. Plus, all 401(k) contributions are pre-tax, meaning that you don't have to report them on your yearly tax forms. That could kick you into a lower tax bracket and reduce the amount you owe to the IRS. You will have to pay taxes on the money when you take it out at retirement.