Retirement Plan (401k) - Physician Contract Glossary

Retirement Plan (401k)

Definition

A tax-advantaged savings account used to accumulate retirement funds, often with employer contributions.

Examples in Context

“Employer shall contribute 5% of Physician's gross earnings to a 401(k) plan, subject to a five-year vesting schedule.”

“Physician may contribute up to the IRS annual limit to their 401(k) plan, with employer matching up to 3% of salary.”

Implications for Physicians

• Important for building long-term financial security.
• Employer matching can significantly increase retirement savings.
• Vesting schedules may delay full ownership of employer contributions.

Negotiation Tips

• Ask about employer contribution matching percentages.
• Request clear details about vesting timelines.
• Verify if investment options meet your long-term goals.

Red Flags and Pitfalls

• Long vesting periods that delay ownership of employer contributions.
• Employer may offer no matching funds, limiting retirement growth.
• Hidden fees or poor investment options may reduce returns.

Related Terms

• Summary Plan Description (SPD)
• Fringe Benefits

FAQs

• “What is vesting?”
  • Vesting refers to the process of gaining full ownership of employer contributions over a specified period.
• “Can I choose my own investments?”
  • Yes, most 401(k) plans allow you to select investments from available options like mutual funds and ETFs.
• “What happens if I leave before I’m fully vested?”
  • You may lose some or all of the employer-contributed funds, depending on the vesting schedule.
• “Are my 401(k)

Legal Disclaimer

The information provided in this glossary is for educational and informational purposes only and should not be construed as legal advice. While we strive to provide accurate and up-to-date information, this content is intended to help physicians better understand common contract terms and does not replace professional legal guidance.

For personalized advice regarding your employment contract or other legal concerns, we strongly recommend consulting with a qualified attorney who specializes in physician employment contracts.

You can find experienced legal professionals through our Physician Contract Lawyer Directory.