What is a 401k plan and how does it work?
A 401k plan is an employer-sponsored retirement savings plan that allows you to contribute pre-tax or post-tax deductions from your paycheck into an investment account. You can typically choose from a range of investment options, which often include mutual funds chosen by the plan sponsor. Learn more about the 401(k) Retirement Plan here.
Safe Harbor Employer Match Contributions
Motivate will match 100% of your contributions, dollar for dollar, up to 3% of eligible pay, plus 50% of each additional dollar greater than 3% and no more than 5% of eligible pay.
Safe Harbor Employer Match Contributions
Motivate will match 100% of your contributions, dollar for dollar, up to 3% of eligible pay, plus 50% of each additional dollar greater than 3% and no more than 5% of eligible pay. Your Contribution | Company Match |
1% | 1% |
2% | 2% |
3% | 3% |
4% | 3.5% |
5% and above | 4% |
Your Contributions
• You can make plan contributions up to the maximum allowed by the plan, not to exceed annual IRS limits.
•You can choose to make pre-tax 401k and/or post-tax Roth 401k contributions.
Vesting Schedule
•Your payroll contributions (and any rollover contributions) are always 100% vested.
• You are immediately 100% vested in Motivate’s match contributions to the plan.
Enrollment 401k enrollment is processed online. Review our Fidelity Retirement Guide on how to enroll and create your account. If you have trouble with enrollment, please open a ticket with Benefits on the PHD or have your manager open a ticket on your behalf.
» Questions about your retirement account?
Call Fidelity at 1-800-835-5097.
RETIREMENT PLAN BASICS
What is the maximum contribution I can make in a year?
The maximum contribution you can make in 2024 is $23,000 (excluding any company match amounts). Catch up contributions of up to $7,500 are allowed for participants who are age 50 or older, thus allowing a total contribution limit of $30,500 in 2024.
What types of contributions can be made?
You can choose to contribute pre-tax dollars into a 401k or post-tax dollars into a Roth 401k plan.
What is the difference between a 401k and a Roth 401k?
401k contributions are deducted from your paycheck before taxes. You pay income taxes on the withdrawals from your account upon retirement. Pre-tax 401k contributions lower your taxable income for the year.
Roth 401k contributions are made after taxes are withdrawn from your paycheck and deposited into your account. Upon retirement, you do not pay taxes on withdrawals since you already paid it previously.
What does vesting mean?
Company matching funds vest over time and can occur immediately or over a period of years. If you leave the company before you are fully vested, you’ll only get to keep a portion of the match or possibly none at all. If you are fully vested, you can take the entire company match with you when you leave the company.
When can I withdraw funds from my 401k?
You have to wait until age 59.5 to withdraw from your account without owing the 10% early withdrawal penalty. But if you are 55 years or older, then you can tap into your funds right away without being penalized. You will still owe income taxes on any 401k withdrawals.
ABOUT THE MOTIVATE 401k PLAN
Who is eligible to enroll?
Full and part-time employees who are at least 21 years old. Seasonal employees are excluded unless they meet an annual service requirement of 1,000 hours from their original date of hire. All other statuses are ineligible.
When can I start contributing?
Eligibility starts the first day of the month from your date of hire.
What types of compensation can I contribute?
Your contributions can include 1% to 100% of your salary, bonuses, or catch up contributions (if applicable).
When will I see my contribution changes on my paycheck?
Any contribution changes to your account will be processed once a month. For example, if you decide to change your contribution rate from 8% to 5% in February, you will not see the change go into effect until the first pay period in March.
Can I borrow from my 401K funds?
Yes, you are allowed one loan at a time. A 401k loan is not subject to taxes or the penalty fee except in the case of default. Any outstanding loans must be repaid in full upon termination from Motivate.
What do I do with my funds when I leave Motivate?
You can leave the funds where they are.
Move the money into your new employer’s plan once you are eligible to participate. You can call Fidelity at 1-800-835-5097 to request a distribution.
Move the money into an IRA (Individual Retirement Account). Your money continues to grow tax-deferred but you are no longer limited to the investment choices within your old plan.
Cash out the funds. However, any amounts you withdraw will be considered taxable income and there will also be a 10% penalty fee because you withdrew before retirement.
How can I withdraw funds? How do I rollover my funds? How do I apply for a loan?
Contact Fidelity Customer Service at 1-800-835-5097 for assistance and next steps.
How do I access my account?
Visit Fidelity NetBenefits to set up your account or call Fidelity at 1-800-835-5097 if you need help getting started.
