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Congratulations,
you landed a job!
Entering the "Real World"
is a time of excitement, enthusiasm, and exploration. For many college
students, it represents the crowning achievement of their educational
experience. The courses, insights, and knowledge you have gained
through your education will be tremendous assets as you make the
transition to the world of work.
The new opportunities and experiences
you'll encounter will be both exhilarating and, at times, frustrating.
As you will most certainly encounter situations for which higher
education did not prepare you, the graduate who enters this world with
open eyes, a willingness to learn, enthusiasm, and common sense
invariably does better than the one who naively expects life to
continue as before.
The purpose of this monograph is to
present some of the realities and opportunities of the first career
job to help the new graduate make the transition successfully.
Although it may seem like there are as many don'ts as there are do's
throughout this monograph, realize that both are equally important to
succeeding in your new environment.
BEFORE YOU ARRIVE
You have the job offer and are
excited about the opportunity, but don't know where to start. Begin by
thinking about the things that you'll need to do before you move.
Finding an apartment is a good start. There are some employers who
will assist you with this process, so begin by asking if your new
employer will make a referral. Web sites abound on the subject of real
estate, allowing you to conduct on-line apartment searches. However,
you will need to visit the area to secure an apartment, as tiny
pictures and brief descriptions on the internet can often be
deceiving.
A local real estate agent will be
happy to show you property rentals. Consider location, commuting
distance to work, property amenities, and population demographics.
Take some time to closely evaluate your new salary and create a
monthly budget so you know what price range you can afford when
apartment hunting. One commonly used rule of thumb is to spend no more
than 40% of your take-home pay on housing/apartment rent.
When creating a budget, be sure to
work with your net income - after deducting things like taxes,
insurance, benefits, savings/retirement investments. Usually, this
computes to approximately 30% less than your gross salary. Begin by
making a list of all of your essential expenses - things like rent,
car, insurance, utilities, gas, groceries, clothes, student loans, and
savings. After calculating the net income you have "left
over," consider those additional expenses like parking,
newspaper, eating out, cellular phone, gym membership, doctor visits,
birthday/holiday gifts, and credit card payments. The point being
there will always be extra things you want to spend your money on, but
prioritizing your expenses will allow you to get a better picture of
your financial status.
A word of caution about credit cards.
Credit cards are abundantly easy to obtain while you're in college, so
seize the opportunity and obtain one. However, carefully consider the
fine print and analyze terms such as grace periods, billing dates,
late fees, and teaser rates. Realize that it's much easier to use this
piece of plastic recklessly, so a credit card spending strategy should
be considered. A simple strategy is to create a "credit
card" folder. Immediately after you've exercised your
"plasticity," write a check to cover the expense, attach it
to your receipt, and place it in your credit card folder. This will
help you build your credit rating, maintain your bank account, and
stay out of credit card misery. Credit cards are conveniences that
have become a necessity in the business world. Be sure to use them
wisely so that you can tame "The Plastic Monster."
An important, often overlooked item
by new college graduates is saving and investing. To drive home the
importance of understanding the "time value" of money, let's
consider this example. Sally and Frank are each 22 years old and plan
to work until they are 65. Sally opens a qualified retirement plan at
12% and invests $2,000 a year for six years, then STOPS. Frank SPENDS
that extra $2,000 a year on himself for the first six years, then
opens a qualified retirement plan at 12% and invests $2,000 a year for
the next 37 years. Sally has invested only $12,000, compared to Frank
who has invested $74,000. However, at 65 years of age, Sally has
accumulated $1,348,440, nearly IDENTICAL to Frank's accumulation of
$1,363,780!
Understanding your benefits is
crucial to getting a good start with your new employer. Hearing terms
such as indemnity, PPO, HMO, POS, PCP, COBRA, FSA, 401K, and 403B
being thrown around at employee orientation as if they are second
nature can be an intimidating experience. Don't worry, a list of these
terms and their basic meanings are provided at the end of this
document. Realize that if something remains unclear to you regarding
your benefits package, you can schedule a time to meet with your
friendly human resources representative. Remember, more often than
not, employers aren't going to spoon-feed you this information. Be
proactive - research the terms to understand meaning, carefully read
through your employee handbook, and develop a list of questions prior
to new employee orientation.
Another item on your checklist of
"pre-arrival" things to do is to update your wardrobe.
Although many companies are implementing more casual dress codes, it
will likely be necessary to update the typical college student's
eclectic collection of clothing. Substance is very important and much
will be expected of you in your new job. In the workplace, however,
you must also recognize the importance of image.
In college, those who assign grades
don't care much about image (and grades are not assigned based upon
image, but upon whatever other criteria the professor has set). You
may dress radically, doze through classes, drink heavily many nights
of the week, use profanity liberally, complain about the
establishment, and so forth. College is meant to be a time for
self-exploration, and many of these activities are tolerated as long
as acceptable grades are maintained.
In the workplace, image becomes much
more important than it was in college. This seems superficial to many
graduates, particularly those with a penchant for rebelliousness, but
there are reasons for the importance of image. Many of the first
impressions you make will be based upon image and these impressions
affect how you are viewed within your organization, by clients or
other outside contacts. How many times have you formed an opinion of
someone within the first minute of meeting him or her? Most of you
will certainly agree that impressions are clearly influenced by dress
as well as communication skills. These impressions project an image of
your entire organization and your personal "image" should
not be treated lightly.
A major part of image is how you
dress and groom for the job. Clothing is important! Regardless of a
formal business or casual dress code, your attire is one of the first
things people will notice about you and you must pay attention to it.
Most college students expect to "get by" for a while
realizing that they might look shabbier than colleagues from time to
time. DON'T! You need to be able to dress appropriately the first day,
the first week, and the first month on the job. This means an up-front
investment in clothing that will allow you to be appropriately attired
on a daily basis.
Other tasks that you should complete
prior to your arrival include filling out all necessary paperwork and
knowing when, where, and to whom to report on your first day of work.
Be sure to take some time to read, even study, the company literature
and human resources handbook you have been provided. Any insights you
can gain, whether procedural or cultural, will give you a head start
and help you make a good impression during career start-up.
Finally, it is a good idea to get
some time to unwind between graduation and beginning your job, because
it will probably be your last vacation for a while. Many jobs offer
two weeks vacation per year to new employees, and usually you cannot
take a vacation day until at least six months have passed.
Thanksgiving, Christmas, and New Year's are just short holidays.
All the years you've been attending
school you've become accustomed to long vacations after each term, a
summer vacation of three months, and a liberal holiday schedule. Now
you find that it's week after week of work with no big break at the
end of a project. You may be asked to work weekends to meet a tough
deadline - just a part of the job.
You may well look back enviously on
all the free time you had during your college years. Remember them
fondly, but don't resent the demands made by the job. You paid the
college - your employer is paying you.
ON THE JOB
The transition from the world of
higher education to that of the first career job is a dramatic one.
The adjustment to a new community coupled with the task of developing
new professional and social networks can be very emotionally taxing.
Things that had been simple in college, like going out with friends or
on a date, will not happen as easily in your new environment. Fewer
social opportunities along with a demanding work schedule can make you
feel pretty lonely during the first few months of your new life. If
your evenings and weekends are open, be proactive to find people you
like to be with in your spare time. Making a connection within your
new community can be made easier by becoming involved in local clubs,
churches, volunteer organizations, or classes.
Your first few days and months on the
job set the stage for long-term success within your company. When the
big day finally arrives, make sure you have prepared by getting a good
night's rest and arrive early! Throughout the workday, remain focused
on learning, listening, and be sure to ask questions when you have
them.
You may fondly recall the time and
flexibility of those college days - sleeping in, skipping class,
arriving late, and leaving early. Recognize that you are in a new
environment, one with less freedom and more structure, more
responsibility and accountability, less vacation time, fewer social
opportunities, and REAL performance evaluations. Realizing that the
real world is much less tolerant of mistakes, offers less time and
flexibility for adjustment, and demands performance for the pay it
offers is a critical part of your transition.
For example, some students avoid
morning courses like the plague, stay up till 3:00 a.m. most nights,
cut classes and get notes from their friends, and goof off for weeks
at a time, then work at a frenzied pace to finish the term in decent
shape. If you had a tendency to follow this sort of schedule in
college, forget it.
First of all, you can't cut work. If
your starting time is 8:30, you are advised to arrive early and alert.
Excuses for tardiness or absences will not be appreciated and
recurring behavior of this type will result first in a negative image,
then in dismissal.
The workplace will not care that you
are "not a morning person." It will not be interested in
your late night escapades, or the fact that your car would not start.
Develop a reputation for being punctual. One of the easiest ways to
make a good early impression at your new workplace is to demonstrate
consistent punctuality.
Many professors' grades are based
upon exam scores and maybe a term paper. They don't care if you never
show up for class, as long as you learn the material. This might be
fine on the campus and you might have enjoyed the leniency, but
recognize the fact that it is not accepted in the real world. Even if
you get more done in six hours than others do in ten, tardiness is not
acceptable.
College life allows for all kinds of
mid-day breaks. You could relax during a major part of many days and
study on your own schedule. The job will probably call for you to be
working continually through the day. There will be time for lunch and
brief interludes during the day, but you won't have time to leave the
office and go for a swim, take a nap, etc. This straight-through
schedule can be a difficult adjustment.
RELATIONSHIPS WITH YOUR SUPERVISOR
Relationships in the workplace are a
major factor contributing to your career success. The knowledge of
"how" to develop positive workplace relationships will
contribute to your success in this regard. Your co-worker
relationships will most likely be much different than the
relationships you formed in college, and so will the ways in which you
develop them.
To enhance your relationship building
success in the workplace, be sure to listen to what others have to say
and understand their position before articulating your position. Be
willing to work with each individual, get to know them as a
professional, and concentrate on their positive qualities and inner
potential. Do not focus on their weaknesses, but rather compliment
those weaknesses with your strengths. It is critically important not
to focus your energy on validating others' weaknesses (in other words,
don't talk badly about other people behind their backs). Finally, be
sure to communicate effectively with others. Communicate your concerns
(be tactful), your challenges (be honest), and last, but not least,
your accomplishments (be modest, yet direct).
Most important among the many
relationships you develop is the one with your supervisor. Your
supervisor is not like your college professors and should not be
viewed in a similar manner. The professor had all the answers,
encouraged argument and debate, laid out guidelines to assignments
(generally well ahead of a due date) and was expected to be fair and
objective. Your supervisor, on the other hand, will often send you to
get the answers, may discourage arguments, will be vague as to how to
complete a task, and will often come up with last minute assignments,
unclear priorities, and vague directions. The sooner you can accept
this change from professor to supervisor, the greater your chance at
success.
Your supervisor controls a great deal
of what can happen to you during your first year. If you come into the
organization with a willing attitude, demonstrate poise and maturity,
and work well with others, you may begin to be chosen for the better
assignments. If you fight the system, grunt work will become your
specialty. The more you complain about it, the more the boss will pile
it on. The more enthusiastically you complete the grunt assignments,
the more quickly you'll be moved into the better ones.
If your supervisor is not your ally,
you have big problems. You might sometimes view him as the enemy
because he may be demanding more than you want to give, intruding on
your free time, and causing you to lose sleep at night. Accepting this
requires you to change your paradigm and accept a realistic
perspective regarding the world of work and how it differs from
college.
One of your biggest responsibilities
in the new job is to make your supervisor look good. This means
completing work on time and with excellent quality, acting like a
professional at all times, and maintaining a positive attitude. If you
regularly do what you can to make your supervisor look good you are
already progressing in the right direction.
Your supervisor is expected to train
and develop you, not to become your best friend. Don't expect to form
a buddy relationship with this person, and it is not recommended to
use him/her as the sounding board for your personal or financial
problems. Too much awareness of these problems can affect her view of
your maturity, professionalism, and competence. Not all of us handle
our personal lives as well as our jobs, and they should be kept
separate.
Let's discuss a hypothetical
situation. It is Friday afternoon and you have plans at the lake for
the whole weekend. Suddenly your supervisor calls you in and loads you
down with files so that you can prepare a detailed report for an
unexpected Monday morning meeting. She apologizes but the meeting was
just scheduled and she also has to prepare for it.
You are now left with several
possible choices. You can go through with the weekend plans and try to
do your work in quiet moments here and there, and by pulling an
all-nighter on Sunday. You might not do your best work but you feel
it's unfair to expect you to change plans that have been made for
weeks.
You can explain the situation to your
supervisor and see if she'll reassign the work to someone else. She
seems pretty reasonable and might not hold it against you.
You can cancel the weekend plans and
do the best possible job on the report. You get a good night's sleep
on Sunday so you go to work on Monday fresh, alert, and confident of
your information. Your supervisor recognizes and appreciates your
effort and knows that she can count on you, a point she makes clear to
her superiors.
Career-wise, the choice is clear. You
sacrifice personal plans, at times, to do the best job possible if you
want your career to advance. This may happen a number of times during
your "freshman" year and if you are not responsive your
supervisor will probably write you off.
Is it fair? Probably not, in the
college frame of mind. However, in your career where you and others
are competing for advancement, it certainly is fair. Willingness,
flexibility, and cooperation count for a lot in your boss' eyes, and
in the view of others with whom you work.
Suppose you're working for a good
organization but got stuck with a "lousy" supervisor. He is
demanding, unreasonable, poor at training, and everyone agrees that
he's going nowhere. It's a very difficult situation to handle, but one
that may be improved by changing your paradigm.
Your paradigm, or frame of reference,
of your supervisor is that he's difficult, unreasonable, unmanageable,
or maybe even crazed! In life, our attitudes and behaviors are
controlled by and evolve from our paradigms. If the paradigm you hold
of your supervisor is negative, adjusting your attitude and behavior
is most likely difficult, impossible, or at best, only temporary.
However, let's take a look at what
happens if you adopt a new paradigm of your so-called
"lousy" supervisor. A paradigm that focuses on his positive
qualities - that he is deeply committed to the company, works very
hard and long hours, and is a perfectionist. By seeing your supervisor
in a different light, it will be much easier to change your attitude
and behavior to one that will support him, support the company, and
will provide you with opportunities for advancement.
The idea is to perform and learn as
best you can so that you can make significant contributions to the
company and become an indispensable resource, perhaps putting yourself
in line for a promotion. There are intolerable supervisors, to be
sure, but many college graduates either quit prematurely or dig
themselves into an irreparable hole through negative attitude and weak
performance under circumstances to which they overreact. Your initial
supervisor is not forever, and if you can survive a year with a
particularly tough supervisor, that alone can be viewed as a feather
in your cap. Before you lose your temper or take any rash steps that
could jeopardize your career with the organization, take time to think
how you might adjust your paradigm so that you can be more supportive
to your employer.
IDENTIFY A MENTOR
An invaluable tool in both learning
the job and developing good relationships with your co-workers is
identifying a mentor. New employees should take the time to develop
relationships with people in the organization who have good
reputations. Choosing a mentor who has been employed with the
organization for a longer period of time is usually the best choice.
This person is able to provide valuable and unique insights into the
organizational culture while helping the new employee learn the ropes,
and understand the political landscape.
Mentor selection is an important
factor in the college student's ability to successfully transition to
the workplace and is worth further discussion. An effective way to
choose a mentor at work is to focus on what you want to be and do,
identify a highly influential individual in your life, and think about
how this individual has contributed to your life. This person may be a
parent, work associate, friend, family member, or neighbor. Answer the
following questions, keeping in mind your professional and personal
goals relating to what you want to be and do. Who has been one of the
most influential people in my life? Which qualities do I most admire
in that person? What qualities have I gained (or desire to gain) from
that person? After you have made a list of these qualities, seek
someone at work who appears to have the qualities that you admire and
seek to develop in yourself.
The mentor you select can be an
invaluable resource as you navigate your first year on the job.
Schedule regular times when you can listen and learn about the various
aspects of your new company, new job, new trends, new technologies,
corporate culture, etc. A weekly lunch where you can hold a focused
discussion on your progress - what you've learned, what you'd like to
learn, your career goals, your mistakes, and your successes. Be sure
to take the opportunity to listen carefully to your mentor's feedback,
as they may likely be someone who can assist you in realizing your
career goals.
RELATIONSHIPS WITH CO-WORKERS
Getting along with your co-workers is
particularly important. It is worth noting the relationships you
develop with your co-workers will, in many cases, be very different
from the relationships you developed in college. Even though
competition for grades in college can be fierce in some cases, it does
not usually get in the way of friendships, trust, and personal
openness. Few faculty members pit students one against another, and
students generally help one another by studying together, sharing
class notes, and tutoring.
In the job setting, you are faced
with a different situation, somewhat paradoxical in nature. You and
your peers are working for the same organization with the objective of
helping the organization fulfill its mission. That is why they are
paying you. In order to function effectively you must be able to work
well with others. You will be continually called upon to engage in
teamwork to complete a task or project. At the same time, you are
competing with these peers for recognition and advancement.
Entry-level positions vary greatly in
personal contact. You may have very little contact with your peers in
the organization or you may work side-by-side with a whole group of
them. It is important that you cooperate, get along well, and develop
relationships of mutual support with them. One of the most challenging
issues in the workplace is to get along with co-workers that you don't
like. Make every effort to develop positive working relationships with
all of your co-workers. Those who stay with the organization will be
advancing with you as you assume management roles, and your ability to
work with them will magnify in importance.
Inevitably, however, you will come
across some people who insist on playing games. They may think they
are masters of manipulation, and they will deceive others, take credit
for ideas not their own, attempt to use personal relations in place of
job performance, misrepresent their real influence or power, etc.
Obviously such co-workers cannot be trusted, but you must also be
careful around them for they can be vicious enemies. Such deceptive
tactics will sooner or later cause their downfall, so don't let such
people discourage you or bring you down with them.
When you begin meeting your peers, be
friendly but don't immediately join a clique. Spend some time
observing how people act, who performs well, and who takes a positive
view toward the job and the organization. There is a good chance that
one or more perpetual gripers will try to befriend you and add you to
their group, spending lunch hours talking about how bad things are.
Keep your distance. Look for those who are doing well on the job, and
whose personalities you can relate to. The gripers are going nowhere.
Finally, don't use co-workers as
confidants. A peer may someday be your boss, or you may be his. Laying
out all your feelings, fears, anger, emotions, dreams, etc. to a
colleague can come back to bite you when you least expect it. Your
innermost feelings should be saved for those who are outside the
organization.
Hopefully, some of your co-workers
will become good friends. The above paragraphs are not meant to
discourage your willingness to establish on-the-job friendships, but
you need to be cautious. Unlike college where you can add and drop
acquaintances at the drop of a hat, job-related relationships must go
on even where two people may have little in common personally.
The Society for Human Resource
Management survey results clearly illustrate the significant role of
relationships in the workplace. The study focused on identifying the
causes of performance problems in the workplace and found that, in
more than 65% of cases, problem employees (many of whom wound up
getting fired) didn't lack technical skills or motivation, but rather
suffered from strained relationships with co-workers. Another study,
by the Bureau of Vocational Guidance at Harvard, shows that, for every
person who loses a job because of poor quality work, two more are
fired because they simply cannot deal successfully with other people.
So, it's not only who you know or what you know, but how well you get
along with others that is increasingly becoming a key factor in one's
career success story.
DO SUBORDINATES CORRECT YOUR
SPELLING?
Many new hires have the misperception
that they will arrive on the new job with company car, laptop, expense
account, and an army of subordinates on-hand to perform all sorts of
undesirable tasks. Unfortunately (for a new hire), this is rarely the
case. In fact, it is often the entry-level college graduate who is
asked to photocopy reports, deliver memos, proofread documents, tally
columns of numbers, and even run errands. The better your attitude in
handling these chores, the sooner you advance from them. They are all
a part of "learning the ropes."
You may well work in an environment
with "hourly" employees. (You will be most likely be
"salaried," meaning management or professional and expected
to work as many hours as are needed to get a job done.) Hourly
employees are generally paid less than salaried, have lower status
jobs with less advancement potential, receive extra pay for overtime
work, and are the life-blood of many organizations.
Too frequently the new college
graduate arrives on the scene and treats the hourly secretaries, sales
clerks, production workers, technical aides, etc. as personal
subordinates. If you fall into this pattern you will probably
jeopardize your potential to succeed. Hourly employees are very well
attuned to the arrogance of many new college graduates, and if they
sense this arrogance in you they can respond in ways to make your life
miserable. Never act in a condescending or superior manner to those
with less education or lower positions. Besides being an inappropriate
thing to do, it will surely have negative ramifications on your career
advancement within the company.
Let's look at an example of how this
can happen. A management trainee at a large retail store is put in
charge of the small appliance department. He arrives on the job and
immediately lectures the lead salesperson about how he is going to
straighten up the department (based upon college coursework and a
summer job at another store). The lead salesperson has been in that
department over twelve years, listens to his lecture, and decides not
to support him because of his arrogance. That poor management trainee
is in for a tough time because of his lack of sensitivity, but the
veteran salesperson will not suffer at all.
Treat all people well! Develop a
reputation for being good to work with. Before you try to order a
secretary to bring you your coffee, or drop a stack of papers on
someone's desk and insist that it be copied in five minutes, think
about how you would like to be treated if the situation were reversed.
As a new hire, subordinates are not
at your beck and call. Many of them will have been in their jobs for
years, are highly valued employees, and do not exist to cover the
deficiencies in your background. They will not correct all your
spelling errors, or all the other first-time errors you might make -
unless they like you.
CAREER PATH - KEYS TO SUCCESS
Communication - voice mail, email,
cell phones, wireless internet access, and handheld devices.
Technology tools to enhance communication in the office continue to
grow at a furious pace. Many experts think that this proliferation of
technology will require workers to communicate more effectively and
articulately, making so-called soft skills invaluable to an employee's
success.
An OfficeTeam research study called
"Office of the Future: 2005" pinpointed six key
"people" skills that employers expect to need in the future:
problem-solving, ethics, open-mindedness, persuasiveness, leadership,
and educational interests (as in, willingness to pursue training in
new skills and acquire knowledge in unfamiliar areas). People usually
build these skills over time through observation, experience, and
instinct. However, there are additional ways to further develop these
skills. Finding a mentor, signing up for formal training classes, or
involving yourself as a volunteer in a professional or civic
organization committee are great ways to hone these skill sets while
making solid connections within your community. Keep in mind that you
control your career path by knowing yourself and your goals better
than anyone else! You are ultimately responsible for both your career
failures and your career successes. Much of what happens throughout
your career is neither wholly great nor wholly bad.
Be proactive in the way you approach
your career. The key variable is the recognition of the differences
between school and work and a willingness to adjust rapidly to these
changes. Don't be unwilling to take on the simple gofer-like work or
the overwhelmingly complex tasks, and don't be afraid of failure.
Nothing beats a positive outlook and strong work ethic. Learn to
stretch yourself beyond what you feel is imaginable. Thomas Edison
once said, "Opportunity is missed by most people because it is
dressed up in overalls and looks like work." Don't let
opportunity pass you by.
BENEFIT TERMS YOU SHOULD KNOW
Health Plans
- Indemnity or Comprehensive
Plan: health plan in which you meet a deductible, then the
plan pays a percentage of covered charges. You are responsible for
the rest. Your choice of physicians or facilities is not limited
to a specific network.
- Preferred Provider Organization
(PPO): health plan in which you go to providers within a
network who have agreed to provide services for a predetermined
amount of money. Your costs are higher if you use a provider from
outside the network.
- Point of Service (POS) or
Managed Care: Health plan in which your care must be
coordinated with a primary care physician. Authorized care within
the managed network is covered (often in full, after a nominal
co-payment). You can go outside the network, but your costs will
be higher.
- Health Maintenance Organization
(HMO): Health plan in which your care must be coordinated with
a primary care physician; within the network services are
generally covered in full or after a small co-payment. You can go
outside the network for care, but in most cases will receive
little or no financial assistance from the insurer.
- Primary Care Physician:
Your "family doctor," who practices in any of the
following medical fields: internal medicine, family practice,
pediatrics or general practice.
- COBRA (Consolidated Omnibus
Budget Reconciliation Act of 1985): Legislation whose health
care coverage provisions include the opportunity to continue your
health coverage after leaving an employer's plan. Typically you
must pay the full cost of coverage, and may continue coverage for
up to 18 months.
- Cafeteria Plan or Flexible
Benefits: A benefit program that offers employees a choice
between a variety of benefits, such as medical, dental, vision,
life insurance and disability coverage. In many cases, employers
provide a core amount of money that you can apply to the cost of
available benefits as you wish.
- Flexible Spending Accounts:
An account that permits you to pay for IRS-approved health care
expenses or dependent care costs on a pre-tax basis. You authorize
pre-tax contributions from your pay into these accounts and then
file claims for eligible expenses to be reimbursed from your
account(s).
Retirement Plans
- Defined Benefit Plan: A
retirement plan in which your employer makes contributions on your
behalf, investing the money so that at the time you are eligible
to withdraw the money, it will equal a predetermined benefit.
Payment may equal a flat monthly payment or a lump sum amount.
- Defined Contribution Plan:
A retirement plan in which you or your employer make contributions
to your account. The amount that is contributed is defined; the
value at the time you withdraw your money is not guaranteed but is
a result of how your money was invested. You are responsible for
investing your account, typically within a range of options
provided by the employer.
- 401(k) or 403(b):
Retirement plans that allow you to contribute money toward your
retirement on a before-tax basis. You pay taxes on your
contributions - and their earnings - when you withdraw the money,
typically at the time of retirement. Many plans offer an incentive
for employees to save, matching employee contributions up to a
certain level.
Mr. Scott Williams
Executive Director,
Career Services Center,
University of Georgia
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