Vanguard Group 401(k) match, vesting and fees

Upon enrollment in the Plan, participants are fully vested at all times in Participant Contributions and Matching Contributions plus actual earnings thereon held in their accounts. Vesting in Retirement Plan Contribution plus actual earnings thereon is based on years of continuous service. A participant is credited with one year of service for vesting purposes for each calendar year during which the participant is credited with at least 1,000 hours of services as an employee of Vanguard.

The Plan includes an auto-enrollment provision whereby all newly eligible employees are automatically enrolled in the Plan unless they affirmatively elect not to participate in the Plan. Automatically enrolled participants have their deferral rate initially set at 4 percent of eligible compensation with an increase in the annual contributions at a rate of 2 percent each year up to a maximum of 12 percent per year. Contributions for automatically enrolled participants are invested in the Plan’s default fund, the Vanguard Target Retirement Trust Select with a Target Retirement Date closest to the year the participant attains age 65.

Each year, participants may contribute up to 50% of compensation, as defined, on a pre-tax or Roth after-tax basis (“Participant Contributions”), up to an amount which does not exceed dollar limitations set forth by the Internal Revenue Code ($23,000 for 2024 and $22,500 for 2023).

Participants may borrow from their accounts a minimum of $1,000 up to a maximum equal to the lesser of $50,000 or 50 percent of their account balance. Loan terms range from 1 to 5 years or up to 30 years for the purchase of a primary residence. The loans are secured by the balance in the participant’s account and bear interest at a fixed rate commensurate with the month-end Prime Lending Rate plus 1.00%. Interest rates ranged from 4.25% to 10.50% on loans outstanding as of December 31, 2024 and December 31, 2023. Principal and interest is paid ratably through monthly payroll deductions.