By Andrew Clark
Source: NPPC

A new study from Vanguard outlines a predictable yet troubling reality: The vast majority of employer contributions to 401(k) plans benefit higher-income employees rather than their working-class counterparts.

The study, conducted by economists from MIT, Yale, and the U.S. Census Bureau, found significant disparities in employer matches to 401(k) contributions among different demographics. Black and Hispanic workers, who typically earn lower wages compared to white workers, tend to contribute less to their 401(k) plans. As a result, they often miss out on the employer matches that higher-earning workers benefit from.

Clearly, this is an issue.

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