A 401(k) plan is a qualified profit-sharing plan that allows employees to contribute a portion of their wages to individual accounts under the plan. This is a retirement savings and investing plan option that employers offer; this type of plan helps employees to invest into their retirement and to also invest into the future. 

Within the 401(k) plan, contributions are automatically withdrawn from employees paycheques and invested in funds of employee's choosing. 

Reasons why employers should offer a 401(k) plan

• It offers employees the opportunity to gain control of their future: employees can contribute as little or as much they want to their account. Employees also have the flexibility to change their contribution levels at anytime. 
• It eases payroll reductions: with a 401(k) plan, employees can make direct and automatic contributions from their paycheck. This makes their savings simple and effortless.

Nevertheless, as an employer it is important to offer a 401(k) plan as it allows employees to take charge of their future savings.