A feature of an employer-sponsored retirement plan is the ability to contribute a portion of your paycheck directly towards your retirement goals.
Getting to the change paycheck contributions screen:
- Login to your account at https://erisa.net/participant.
- Hover over Manage in the top navigation bar.
- Click Contributions.
- Click Paycheck Contributions.
The change contributions screen:
- Savings Assistant (optional): This tool can be used to attempt to maximize 401(k) contributions for the calendar year by inputting your expected pay. The limits are shown on the right of the page for reference. It will automatically set your rate based on the input.
- Pre-Tax Deferral: Select a percent or dollar, and input the amount to defer on a pre-tax basis per-pay-period.
- Roth: If your plan allows Roth deferrals, you may also choose to defer some of your pay on an after-tax basis. Refer to the FAQ for more information on the differences.
- Submission: Input the desired rates using your desired combination of pre-tax and Roth deferrals. Once you’re ready, just click submit.
FAQ
When will my deferral change begin?
We let your payroll know about your change at the end of the next business day. Depending on the timing, you should see it within 1-2 pay-cycles.
What is the difference between pre-tax and Roth contributions?
An advantage of deferring pre-tax is that you’re able to immediately realize a reduction in your taxable income, since the amount is being deposited from your employer straight into your retirement plan. You’re still taxed upon distribution of the funds, but the account grows tax free until then.
Contributions into your Roth account are made after-tax. As long as you make a qualified Roth distribution, the Roth portion of your account is not taxed on distribution. Even if you don’t take a qualified Roth distribution, the amount you contributed is not taxed. Only earnings will be subject to tax and any early withdrawal penalties.