Question

Penelope has decided to start contributing to her 401(k) plan at work. She will contribute 6% of her weekly salary and her company will match 4% of her salary. Calculate the total amount of contributions Penelope will make to the 401(k) account this year (52 weeks) if her salary is $950 per week.

Answer 1

Answer:

Explanation:

Penelope weekly salary = $ 950 per week

she contributes 6% of her weekly salary

total amount Penelope will make to the 401(k) = 0.06 × 950 × 52 weeks = $ 2964

Answer 2

Based on the contributions of both Penelope and her company, the total annual contribution will be $4,940.

Contribution to 401K in the year

This can be found by the formula:

= (Penelope contribution + Company contribution ) x 52 weeks in a year

Solving gives:

= ( ( 6% + 4%) x 950) x 52

= 95 x 52

= $4,940

In conclusion, she will contribute $4,940

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