elective deferral


An employer's contribution towards an employee's 401(k) plan on the employee's behalf that could have been accepted as cash, but was deferred by the employee.

Use elective deferral in a sentence

In the workplace, 401ks are very common, and typically employers choose to do an elective deferral for their employees instead of cash.

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My company gave us the choice of either receiving a cash bonus or receiving an elective deferral into our 401(k) plan to allow us to catch up on our retirement.

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Tom's company offered a great elective deferral retirement plan. This way, Tom was able to plan for his retirement without having to worry about investing on his own.

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profit-sharing nonelective contribution