11
QuizMultiple Choice

Planning for the Cost of College — Unit test

Question 11 • 2027 Ignite Financial Literacy-Personal Finance - EL3403

How can an employer's retirement matching program encourage an employee to save for their retirement?

Answer
A
It increases an employee’s regular paycheck.
B
It ensures financial stability in the short term.
C
It boosts savings by adding extra funds to the employee's contribution.
D
It enhances employee knowledge through mandatory financial seminars.

Explanation

A retirement matching program adds money from the employer based on how much the employee contributes. For example, if an employer matches part of an employee’s contribution, the employee’s retirement savings grow faster than from their own contributions alone. This incentive encourages employees to save more; it does not increase their regular paycheck or ensure short-term financial stability.

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