Help regarding taxes and 401k

[rakhuwin8i]

Hello, I am new to taxes and 401k in the US since starting my first job a few months ago. I have some questions, more precisely -

1) why is there a discrepancy between my total contributions (e.g., $10) and account value/vested amount (e.g., $8)? My 401k dashboard also reads my personal performance as -3.30%. My employee deferral for the 401k is 6%. My employer matches $0.25 to every $1 I contribute, up to 6% of my paycheck. But I don't see these employer contributions anywhere on the 401k dashboard.

2) How to interpret the information detailed under "Investments and Performances"? Is it a list of markets where my contributions have been invested in?

3) Why is federal withholding different for me and my colleague (identical visa status, single, without dependents), and what can I expect when I file for returns in Jan?

For reference, I claimed no dependents on the W4 form and that I am single; I am quite confused and would appreciate some help. Thank you kindly.

 

[mattjstead]

@rakhuwin8i So I think I can at least help with your 401k questions.

A 401k is an investment account. It sounds like currently your investments have decreased in value, so you have "lost money."

It's generally expected that the value of your investments will fluctuate over time. Short term, you may see some losses, but over the course of your life, your investments should grow.

Some companies have a waiting period before they match 401(k) investments. You may want to double-check if there is a certain amount of time you need to be employed before they start matching.

r/personalfinance has a great wiki about retirement, which may be worth reading.

Your withholding for taxes may be different based on optional withholdings like your 401(k). If you chose a traditional 401(k) then that money is coming out of your check before taxes are withheld. It essentially is lowering your taxable income.

Instead, you will pay taxes when you withdraw money from the 401(k) in retirement. This is a good option if you expect to have a lower income when you retire, as you will end up being taxed at a lower rate

 

[rakhuwin8i]

@mattjstead Thank you very much for your time and insight, this is helpful to understand the way the 401k dashboard works.