Your First Job's 401(k): A Beginner's Checklist

A 401(k) enrollment packet from HR is often the first real investing decision most people ever make — and it's easy to just pick defaults and move on. A few minutes of attention here can be worth thousands of dollars over a career.

The checklist

1. Check for an employer match, and contribute at least enough to get all of it. A common match structure is 50% or 100% of contributions up to 3–6% of salary — leaving this unclaimed is leaving guaranteed money on the table.
2. Choose Traditional, Roth, or both, if offered. See our Roth vs. Traditional comparison — the same core logic (pay tax now vs. later) applies inside a 401(k) too.
3. Pick your investments, don't leave contributions sitting in cash. Many plans default new contributions into a money-market or stable-value fund unless you actively choose something else — this can quietly mean your contributions aren't actually invested for growth.
4. Look for a target-date fund if you're not sure where to start. These automatically adjust their mix of stocks and bonds as you approach a chosen retirement year, and are a reasonable single-fund default for many first-time investors.
5. Check the vesting schedule — some employer match money only becomes fully yours after a certain number of years. Your own contributions are always 100% yours immediately.
6. Note the account login and beneficiary designation. Beneficiaries are easy to forget and easy to set in five minutes during enrollment.

How much should you contribute beyond the match?

There's no universal number, but many long-term plans aim for roughly 10–15% of income toward retirement in total (including any employer match), phased in gradually as income grows rather than all at once.

Changed jobs before? Old 401(k)s don't disappear

A 401(k) from a previous employer stays yours — you can typically leave it, roll it into your new employer's plan, or roll it into an IRA. Cashing it out early is usually the costliest option, triggering taxes and often an early withdrawal penalty.

See how it adds up

Once you know your contribution rate, our retirement calculator can project where consistent contributions, plus your employer match, put you by retirement age.

This article is for educational purposes only and is not financial advice.