The 401(k) retirement plan is funded by employee contribution and a matching employer contribution.The major feature of the plan is that the contributions are taken from pre-taxed salary.The fund accumulates tax-free until it is withdrawn. Most businesses and tax-exempt organizations can create these retirement plans.The 401(k) takes its name from the IRC (Internal Revenue Code) of 1978.The operation of the 401(k) is administered by the EBSA (Employee Benefits Security Administration) of the Department of Labor.The 401(k) plan has a lot of advantages. First and foremost is that the employee can contribute pre-tax money that reduces the tax paid in each paycheck. Also, the company contribution and any growth in the fund is free of tax until withdrawn.The compounding of the fund during a 20 to 30 year period is quite amazing. The employee has a lot of control in the direction of the future contributions.When the company matches your contributions, it adds something extra on top of your own money.All money in the plan can be moved from one company to another unlike pension.This lens will detail information for you about 401k and the issues with it such as 401k withdrawal penalties.Investing in your financial future is the greatest gift you can give yourself by far.If you aren't sure where to begin or how, perhaps it's time to seek the services of a qualified financial advisor. His advice may prove invaluable and may give you a much more comfortable future than you would have ever imagined left to your own devices.Click this link to arrange a free retirement financial planning consultation with one of our highly ranked financial advisors.