Why this is correct (Q3 — vesting schedule): Vesting is the process that determines when employer-contributed dollars become the legal property of the employee. Employers can credit matching funds to your account immediately in the sense that they appear on statements, but vesting rules control ownership if you leave before a set period. Two common vesting approaches are “cliff” (you get 100% after a defined number of years) and “graded” (you gain partial ownership each year). Vesting protects employers by discouraging short-term hires from receiving full-match benefits immediately while rewarding employees who stay longer. Importantly, vesting applies to employer contributions (and earnings on those contributions) not to your own elective deferrals — your own contributions are always 100% vested because they’re your money. Misunderstanding this can lead people to think the match is instantly theirs in every sense — it may appear but still be subject to the vesting schedule.

Practical takeaway & what to check: Always check the plan’s vesting schedule when assessing the value of a match, especially if you anticipate changing jobs soon. If you’re close to a vesting milestone, staying a little longer may significantly increase the portion of employer funds you keep. When negotiating job moves, remember that unvested match dollars typically remain with the plan and are forfeited on departure. If consolidation or rollovers occur, vested amounts are straightforward to roll; unvested amounts may not transfer. Consult the plan’s summary plan description for precise timing and rules.