Employee Savings Plan

AAA

DEFINITION of 'Employee Savings Plan'

A pooled investment account provided by an employer that allows employees to set aside a portion of their pretax wages for retirement savings or other long-term goals (i.e. paying for college tuition, purchasing a home). Many employers match their employees' contributions up to a certain dollar amount, or by a certain percentage.

INVESTOPEDIA EXPLAINS 'Employee Savings Plan'

Employees are always fully vested in their own employee savings plan (ESP) contributions. However, many plans require that employees remain employed for a minimum amount of time before they are vested and eligible to withdraw employer-matched funds. ESPs can be an attractive and relatively easy way for employees to lower their taxes and save for long-term goals.



RELATED TERMS
  1. Employment Agency Fees

    An employment agency works to match employers with suitable employees. ...
  2. Employee Contribution Plan

    A company-sponsored retirement plan where employees may elect ...
  3. Vested Interest

    1. The lawful right of an individual or entity to gain access ...
  4. Matching Contribution

    A type of contribution an employer chooses to make to his or ...
  5. Savings Incentive Match Plan For ...

    A retirement plan that may be established by employers, including ...
  6. Employer-Sponsored Plan

    A type of benefit plan that an employer offers for the benefit ...
Related Articles
  1. Savings

    Don't Forget The Kids: Save For Their ...

  2. Taxes

    How After-Tax Rollovers Affect Your ...

  3. Retirement

    Saving For Retirement: The Quest For ...

  4. Taxes

    How To Save More For Your Retirement

Hot Definitions
  1. Turkey

    Slang for an investment that yields disappointing results or turns out worse than expected. Failed business deals, securities ...
  2. Conduit Issuer

    An organization, usually a government agency, that issues municipal securities to raise capital for revenue-generating projects ...
  3. Financing Entity

    The party in a financing arrangement that provides money, property, or another asset to an intermediate entity or financed ...
  4. Hyperinflation

    Extremely rapid or out of control inflation. There is no precise numerical definition to hyperinflation. Hyperinflation is ...
  5. Gross Rate Of Return

    The total rate of return on an investment before the deduction of any fees or expenses. The gross rate of return is quoted ...
  6. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
Trading Center