Does Amazon have a Retirement or Pension Plan?

Amazon, headquartered in Seattle, is an American multinational technology conglomerate. At Amazon, they can provide a lot of benefits for their employees since they care about the welfare of the employees. Based on research carried out by, some of the largest companies like Amazon offer some great benefits for your retirement along with some great pension plans. Let’s know ‘Does Amazon have a Retirement or Pension Plan?’

Does Amazon have a Retirement or Pension Plan?

The employees of Amazon can have a dependent-care flexible spending account. When it comes to having a retirement plan, there is the company’s 401(k) plan with a matching employer contribution plan. Additionally, there is company-paid life and accident coverage.

Amazon 401(k) Plan 

The first part of Amazon’s 401(k) plan is the fact that they will only match up 50 cents for every dollar that the employee puts into their 401(k). To put it in simpler terms, Amazon will be able to match up to 4% of the eligible pay.

The matching from Amazon’s side will be at a base level of a mere 2%. Additionally, it needs to be kept in mind that catch-up contributions are not going to be matched by the company. Right off the bat, you will not be eligible to have a matching investment by the company in a 401(k). 

What this means is that you need to complete at least three full years of vesting services with the company before you can get any amount of benefits from them to comply with the terms of their retirement plans. At the same time, Amazon defines one year of vesting service as having to complete 1,000 hours of service with the company. 

Conditions Related To Amazon 401(k) Plan

Subject to annual IRS limits, you can contribute anywhere from 1% to 90% of your pay (which is eligible) on a pre-tax basis, after the tax basis of the Roth. In 2022, the IRS limit is $20,500. But there is a loophole – if you turn 50 in 2022 or are older than 50, you will be able to contribute $6,500 in catch-up contributions this year. Therefore, these catch-up contributions will not be matched by the company.  

Any Amazon employee that is above 18 years of age, can enroll in the retirement plan immediately after they join the company. However, it can take up to 10 business days to get enrolled at Fidelity.

Amazon’s Stock Units 

Another way of granting a better retirement plan and a pension plan is by investing in Amazon stocks. Through the granting and the vesting of Restricted Stock Units (RSUs), employees can become the owners of stocks at Amazon. 

If an employee works more than 30 hours a week, or exactly 30 hours a week, they can do the following – 

  1. RSUs that grow and vest over time
  2. Can get extra/additional RSU grants. 

Amazon’s Roth 401(k) 

To have tax-free growth and tax-free access to your pension plans, The Mega Backdoor Roth is a beautiful employee benefit that is given by Amazon. This policy allows the employee to increase their benefit level within their 401(k) into a Roth 401(k).

According to an update made in 2022, the employees can save up to $37,000 on the Mega Backdoor Roth portion of their 401(k).

Before this announcement was made, Amazon employees were only able to invest 10% of their base salary beyond their standard 401(k). However, after this announcement Amazon employees can now be able to contribute towards their federal 401(k) that can be converted into Roth.


After years of hard work and meeting arduous deadlines, it has been observed that the first thing employees want is to have a great retirement plan. Various major conglomerates do offer some sort of a retirement plan, but they are all over the place. The Amazon brand can provide a defined contribution plan, which will enable employees to have a strict saving and investment plan for their retirement.

Frequently Asked Questions 

  1. Does Amazon Match The Contributions Of Their Employees? 

Yes, Amazon does match the contributions of their employees when it comes to investing in a 401(k). But Amazon will only be able to match 50 cents to your dollar. 

  1. How Much Can I Invest In My 401(K) Per Year?

Based on the announcement made by the IRS in the year 2022, it can be observed that one person can contribute up to $19,500 per year only if the employee is under the age of 50. But if you are over the age of 50 or are 50 years old in 2022, you can contribute an additional $6,500 to your 401(k).

  1. How Much Can I Put Into My Mega Backdoor Roth Conversion?

Amazon now lets you put up to 10% of your base salary into the after-tax portion of your 401k plan and subsequently convert it to Roth.

Does Amazon have a Retirement or Pension Plan?

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