Everything I wanted to know about 401(k)s
A 401(k) is a retirement account that business provide to their employees as a workplace benefit. Like IRAs, 401(k)s have two distinct forms: Traditional and Roth. They have the exact same general properties that IRAs do and share similar yearly contribution limits.
401(k)s have largely supplanted pensions as retirement packages since they allow employees to more proactive about their retirement contributions and are also cheaper for employers to contribute to: contribution matching is up to a certain percentage and is totally dependent on how much the employee is willing to contribute, versus a pension where everyone gets the same contribution amount.
Types of 401(k)
401(k)s have two familiar offerings: Traditional and Roth. If this sounds familiar, it should: they mirror the two main types of IRAs.
Traditional 401(k)
Traditional 401(k)s allow employees to make tax-free contributions by deferring money from their paycheck as a contribution, and the money within the 401(k) accrues value without any tax penalties. The tax penalties only kick in when withdrawing money from the 401(k) during retirement.
Roth 401(k)
The Roth 401(k) has the same features as the Roth IRA: when an employee defers money from their paycheck to their Roth 401(k), they pay tax on that deferral, but the money within accrues value without any tax penalties and withdrawals during retirement have no tax penalty.
The "Roth Backdoor" where Traditional IRA holders are allowed to just straight up convert their Traditional IRA to a Roth IRA and pay a tax fee is approximately the same for converting a Traditional 401(k) to a Roth 401(k).
Contributing
As stated earlier, individuals fund 401(k)s by deferring part of their paycheck. The JPMC blog post linked at the start of the article suggests contributing at least 15% of your annual pre-tax income to your 401(k), but my financial advisor recommended for my specific case in terms of income trying for roughly 10% of my biweekly paycheck.
The blog post talks about how you can start small with your contributions, but the reality is that if you have a decent-enough income you're going to want to make Serious™️contributions that are going to either max out or get close to maxing out whatever contribution match percentage your employer has.
Changing jobs that each have 401(k)s