You may be walking away from free money by not contributing to your employer-sponsored retirement plan. Many retirement plans, such as SIMPLE IRAs and 401(k)s, provide that your employer will match some portion of the amount you contribute to your retirement account.

Matching contributions:

• are contributions your employer makes to your retirement plan account if you contribute to the plan from your salary,

• don’t reduce the amount you can contribute to the plan from your salary,

• grow tax-free while in the plan, and

• are taxable only when withdrawn from the plan.

An example of a 401(k) plan matching formula is 50 percent of your contributions up to 5 percent of your annual salary (the amount of your salary that can be used in this calculation is limited — see the annual cost-of-living adjustments).

Example: You contribute $1,200 from your $30,000 annual salary to your company’s 401(k) plan. Your employer’s 50 percent match on your contributions up to 5 percent of your salary means your employer would add an additional $600 (50 percent x $1,200) to your retirement account for the year.

Remember, you must participate and contribute to the plan from your salary to get matching contributions. Generally, the more you contribute to the plan, up to the plan’s match limit, the more you receive in matching contributions.

Ask your employer about any conditions you must meet to receive matching contribution, and don’t miss out on having more in retirement savings.