Amazon 401k Match

One of the most attractive features of is the ability to save money with their 401k plan. If you are not familiar with it, if you contribute 6% of your salary to your 401K, Amazon will match that contribution with an additional 3%. This means that for every $1 you put into your fund at retirement age, Amazon will be putting in $0.60 on top of that! Let’s know about Amazon 401k Match

Amazon 401k Match

No other company offers such a generous 401k match. Google, Apple, and other tech companies do not offer 401ks, and Microsoft and Facebook only offer a dollar-for-dollar match (which is still great). And don’t expect this to change anytime soon: “We intend that all Amazon employees receive competitive compensation and benefits.” says Jeff Bezos.

This money compounds over the years because you do not have to pay taxes on your retirement contributions until you take it out at retirement.

So here is a summary of what you will get from an Amazon 401k:

* The ability to save up to $52,000 per year after taxes (without any company match) and $71,000 per year with the company match. The IRS will only allow contributions of $16,500 in 2016 and $18,000 in 2017.

* The ability to buy stock through the plan and possibly avoid capital gains tax.

Jeff Bezos Career Advice
Jeff Bezos Career Advice

* The ability to switch jobs and still save if you wish.

* You can contribute as much as 5% of your salary towards your retirement fund.

The catch: Amazon decides every year what the contribution rate will be; it is not fixed like a 401k set up under an employer. This means that if Amazon raises their contribution rate, you will automatically be contributing at the new rate, but they can decrease their contribution rate as well. Also, although Amazon matches 100% of your contributions, the matching dollars are placed in a separate account which you can only access once you retire (unless they let you withdraw it for financial reasons).

* You can’t make 401k contributions in the following scenarios:

– If your annual salary is less than $10,000, you won’t be able to contribute anything to your 401k plan.

– If you are in the early years of your career (the first 10 years or so), you will likely not be making much money and can’t afford to contribute much.

– If you get laid off or fired, your contributions will immediately stop.

* You must work at Amazon for 3 years before contributing towards your retirement fund. This means that if you get hired 2 months before the end of the year, you cannot contribute to your retirement fund for that year. Your first contribution will be made in year 3.

– If you change jobs, you can keep your contribution rate, or switch it to your new employer’s plan (if they allow it).

* You must work at Amazon for 5 years before you can make a hardship withdrawal. This is to prevent people from using their retirement funds as checking accounts.

– A few people have reported that they were able to make one hardship withdrawal and then their second and third withdrawals were rejected. For some reason, those with multiple rejections never got another chance with Amazon.

* You can make a withdrawal if you leave Amazon for any reason. Except for health, financial hardship, or military service reasons, you must wait one year from the date of your last contribution. If it has been less than a year since your last contribution, then you won’t be able to make a withdrawal until the next contribution cycle.

– A few people have reported that they were able to make a withdrawal and then switch back to Amazon within 2 months and continue to contribute towards their retirement fund without problems. This is because once an account is closed, you can usually re-open it as long as you do so within 60 days from the date of the first closure.

* You must be 18 years old to contribute to your 401k. If you turn 18 less than a year before you make your first 401k contribution, it will not be accepted. If you are a new hire, it will not be accepted until about a month into the year.

* The contributions that you make to your retirement fund are held in an Amazon-specific account and can only be accessed once you retire.

* The IRS limits on contributions are almost certainly going to increase in the next few years; this means that if you want to invest more than $16,000 out of pocket, you should consider making Roth retirement contributions instead.

* If you are eligible, you should try to avoid contributing to a Roth IRA because this will lock in your retirement contributions at a lower tax rate and increase your taxes when you withdraw.

* An Amazon 401k is taxable and must be reported on an annual tax return; they will send you a 1099-R form by early February.

Amazon’s 401k Contributions and Company Match

Amazon offers a company match of up to 4% of the employee’s pre-tax contribution. Yes, you read that right: a company match, not a government-mandated match that your employer may or may not offer.

To be eligible for the Amazon 401k Match, employees must meet three specific requirements. They must

1) have been employed by Amazon for 90 days by March 31st of the current year.

2) have an active 401k plan account.

3) contribute at least 5% of their pre-tax income. The maximum contribution amount an employee can receive from this 4% matching program is $5,000 for 2019 (up to a combined contribution limit with other plans).

Amazon’s 401k Plan Administration

For Amazon to successfully administer its 401k plan, employees need to contribute at least 5% of their pre-tax income, make sure their investment options are diversified, and create an investment strategy. Amazon’s plan allows participants to purchase funds from many different providers. This means that you can invest in mutual funds, exchange-traded funds (ETFs), stocks, bonds, and more!

However, Amazon does have a few restrictions for its selection of investments. First off, the plan only offers mutual funds for its stock market investments. Secondly, no funds with high fees are allowed by Amazon’s plan. Lastly, non-U.S. investments can only be invested in mutual funds.

Moreover, Amazon allows investors to increase their contribution amount to $5,000 by taking out an IRA loan with up to $50,000 at low or zero interest rates for a term of 5 years. These loans must be paid back by April 30th of the following year and must be repaid at least quarterly.

Summary: Amazon offers a company match of up to 4% of the employee’s pre-tax contribution. They also allow employees to take out IRA loans towards their retirement accounts. However, they do not allow investment options with high fees and only offer mutual funds as investment options for its 401k plan.

Amazon’s 401k Contributions as Compared to Other Companies:

“Amazon is a generous company when it comes to 401k matches. They will match 100% of your contributions up to 6% of your salary, the most among companies surveyed.”

Amazon offers a solid 401k match that you should take advantage of because Amazon will contribute six percent (6%) of your annual income into your account. Amazon may offer you the largest matching contribution compared to other companies’ rates which can be as low as 3%. 

It’s clear that the primary reason Amazon gives you a generous 401k match is that they want to attract and retain high-performing employees and meaningfully invest in them by giving you a $100,000 401k matching contribution for every $100,000 you pay into your 401k account.”

“Amazon will match 100% of your contributions up to 6% of your salary, the most among companies surveyed.” [Only twice as much as Google and 3 times as much as Walmart]

“Amazon is the only company that will match any employer matching amount you receive, including cash.”

– “Amazon will match your SEP, SIMPLE, SARSEP, or 401(k) plan contributions (cash or non-cash). If you are covered by a retirement plan through work (such as an employer-sponsored retirement plan like a 401(k), 403(b), or pension), your contributions to that account will also be matched.” 

Amazon Will Match Your Contributions within 24 Hours (if you do it online).

“Amazon’s 401k match contributions will be vested immediately and distributed to your account by the end of the next business day following your earnings date.”

“If you enroll during Open Enrollment (October 1–December 31) and make your first 401(k) contribution by December 31, Amazon matches 100% of your contributions up to 6% for that year.”


If you’re eligible, this is the best thing you can do for your retirement nest egg.

Amazon’s 401k match is a great way to put all your money to work and make the most of any contribution. This is money that our employer will spend on employee benefits and you’re not paying anything extra if you do it. It’s kind of like getting a gift at Christmas! (ok, maybe not like that) but free of charge nonetheless.

Some Frequently Asked Questions:

1. What is the Amazon 401k Match?

The Amazon 401k match is a tiered match for employees of

2. How Much Am I Eligible to Earn?

The first 3% of eligible income that you contribute to the plan as an employee will earn a 100% match from Amazon up to 4%. The next 3% of eligible income that you contribute to the plan as an employee will earn a 50% match from Amazon up to 5%. And any contributions beyond 5%, up until 7%, will be matched 25%.

2. How Do I Sign Up for the Match?

The sign-up process for this matching contribution is handled by your financial institution, not through HR at

3. What Amazon Benefit Programs Are Included?

The Amazon 401k match is a corporate contribution specifically for Amazon employees to retirement savings.

4. Why Does Amazon Offer the Employee Match To Employees?

The decision to provide this matching contribution is largely based on providing a benefit that influences very few employees to choose another company over Amazon, so the trade-off of higher administrative costs versus fewer employee enrollments may be acceptable for them. Note that the IRS has ruled that employers are not required to provide a 401(k) Match, so it’s likely this match will continue regardless of what the IRS says about this matter.

5. Will Other Amazon Employees Start Offering the 401k Match?

If enough of the employees are signing up, then it’s likely that some other companies will offer a match as well.

Amazon 401k Match

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