If your employer offers a
matching contribution to your retirement plan, the cardinal rule is: contribute
whatever the employer is willing to match-even if it is only a percentage of
your contribution and not a dollar for dollar match.

Imagine depositing $1,000 of
your money into the bank, but instead of getting a crummy toaster, you receive
an extra $1,000 to go along with your deposit. To add to the fun, imagine
getting a tax deduction for your deposit and not having to pay tax on your
"gift." Furthermore, both your $1,000 and the gift $1,000 grow (it is to be
hoped), and you don't have to pay income tax on the interest, dividends, capital
gains, or the appreciation until you withdraw the money. When you withdraw the
money, you will have to pay taxes, but you will have gained interest, dividends,
and appreciation in the meantime. That is what employer matching contributions
to retirement plans are all about. If the employer matches the employee
contribution, it offers a 100% return on the investment in one day
(assuming no early withdrawal penalties apply and the matched funds are fully

Over the years, I have heard
hundreds of excuses for not taking advantage of an employer-matching plan. All
those reasons can be summarized in two words: ignorance and neglect. If you
didn't know that before, you know now. If you are not currently taking advantage
of your employer-matching plan, run-don't walk-to your plan administrator and
begin the paperwork to take advantage of the employer match. Matching
contributions are most commonly found within Section 401k, 403b, and 457 plans.
Even if your employer is only willing to make a partial match up to a cap, you
should still take advantage of this opportunity. A fairly common agreement is
that the employer will contribute 50 cents for every dollar up to the first 6
percent of salary you contribute. Don't grouse that it is not enough or not
worth it. You have everything to gain-this is free money that will compound and
grow-and as Einstein said, "The most powerful force in the universe is compound

About the Author:
As one of the
country's top IRA experts, James Lange has
developed tax-savvy retirement and estate plans for over 1400 U.S. citizens with
appreciable assets in their IRAs and 401(k) plans. In his book,
Retire Secure!,
Jim systematically proves you can be tens of
thousands to over a million dollars richer by "paying taxes later" and using
Roth IRAs. Get the absolute maximum from your IRA and retirement plan and avoid
a host of disastrous mistakes by going to