The information about the Meta (Facebook) 401(k) has been updated for 2023.
Your Meta 401(k) is a retirement savings plan that allows you to invest a portion of your salary into long-term investments and save for retirement.
Your contribution and the Meta match are 100% vested from day one with the company.
2023 Meta 401(k) Basics
Your 401(k) contributions increased in 2023.
If you’re under 50 you can contribute up to $22,500 and if you’re 50 or older you can contribute up to $30,000.
These contributions can be made on a traditional pre-tax or Roth basis. The difference between a traditional and Roth 401(k) comes down to when you pay taxes.
Traditional Pre-Tax 401(k): You make your contributions before taxes. You typically receive a tax break up front by lowering your current income tax bill; however, money withdrawn at retirement will be taxed.
Roth 401(k): With a Roth 401(k) you make your contributions after taxes. When you withdraw savings for retirement, you are not taxed.
The Meta Employer Match. Earn Free Money.
Meta will match $1 for $1 of your 401(k) contribution up to 50% of the IRS Federal elective deferral limit. We encourage you to make the most of this benefit by maxing out your 401(k) contributions before utilizing any other benefits available to you. Your employer match from Meta is essentially free money. If you are under 50 years old, you can earn up to $11,250.
Now this part is huge! If you are over 50, Meta will match $1 for $1 of your catch up contribution up to 50% of the IRS Federal limit. This is an additional $3,250 towards your 401(k)! Most employers do not match the catch up contribution. If you are 50 or older we strongly encourage you to maximize this employer match benefit.
Supplement Cash Flow Using Meta Restricted Stock Units
Meta employees receive Restricted Stock Units (RSUs) which can be sold once they vest. With careful financial planning you can sell these shares and use the proceeds for your day-to-day living expenses.
This can free up cash from your salary to allocate towards your 401(k) and other tax-advantaged Meta benefits like the Mega Backdoor Roth and your HSA.
How Can Saving into a 401(k) Reduce Taxes?
The tax benefits associated with a 401(k) plan include being able to make deductions from your salary on a pre-tax basis. This can lower your annual taxable income.
Your 401(k) earnings accrue on a tax-deferred basis, meaning the dividends and capital gains accumulating within your plan are not subject to tax until they are withdrawn at retirement. Many people are in a lower tax bracket when they retire which compounds the tax reduction benefit of saving into a 401(k).
Questions About Your Meta Employee Benefits?
If you have questions about how much to contribute or how to utilize Meta employee benefits, schedule time to discuss what might make sense for you.