Does UPS Really 401(k) Match? – Avoid This Mistake + FAQs

Yes, United Parcel Service (UPS) offers a 401(k) retirement savings plan with a match (branded as SavingsPLUS match) for eligible employees.

This analysis covers UPS’s 401(k) match structure, its historical evolution, key terms, and a comparison with similar employers (FedEx, Amazon, Walmart). We also discuss relevant laws, common pitfalls, and how matching can impact long-term savings.

UPS 401(k) Plan Structure & Eligibility

Eligibility: UPS’s 401(k) Savings Plan is available to employees not covered by a collective bargaining agreement (i.e. non-union employees). Eligible employees can participate immediately upon hire – there is no waiting period to start contributing.

Union-represented employees (such as UPS Teamsters delivery drivers and sorters) have a separate pension plan and do not receive a 401(k) match. However, union employees may still contribute their own money to a 401(k) if offered, but UPS’s contributions for them are directed into the pension fund instead of a 401(k) match.

Employee Contributions: Employees can defer a portion of their pay into the 401(k) on a pre-tax basis, Roth (after-tax) basis, or even non-Roth after-tax basis (for certain lower earners).

UPS automatically enrolls newly hired, eligible non-union employees at a 6% contribution rate (with auto-escalation by 1% annually up to 15% unless the employee opts out or changes it). This encourages participation and gradually increases saving rates over time.

Vesting: Vesting refers to when employer contributions become the employee’s property. UPS’s plan provides immediate 100% vesting for both employee contributions and the employer’s matching contributions.

This means UPS’s matched funds belong fully to the employee as soon as they are contributed, with no forfeiture if the employee leaves UPS.

UPS Matching Contribution (SavingsPLUS): UPS’s 401(k) match is called a SavingsPLUS matching contribution, and the formula depends on an employee’s hire date (reflecting historical plan changes):

• Hired on or before Dec 31, 2007: UPS matches 50% of the employee’s 401(k) contributions, up to 5% of eligible pay. In other words, contributing 5% (or more) yields a max 2.5% of pay from UPS.
• Hired Jan 1, 2008 – June 30, 2016: UPS matches 100% of the employee’s contributions, up to 3.5% of pay. Contributing 3.5% (or more) yields a max 3.5% match.
• Hired July 1, 2016 or later: UPS matches 50% of contributions, up to 6% of pay. Contributing 6% (or more) yields a max 3% of pay from UPS.

These tiers were introduced as UPS adjusted its retirement benefits over time. Notably, UPS closed its defined benefit pension plan to new non-union employees in 2016, and enhanced the 401(k) to compensate.

For example, the more recent hires (post-2016) get an increased match threshold (6% of pay) albeit at a 50% rate, encouraging higher personal savings.

UPS Retirement Contribution: In addition to the match, UPS provides a non-elective “UPS Retirement Contribution” for certain non-union employees (generally those no longer accruing a pension). This is an automatic contribution by UPS equal to 3%–8% of pay, based on years of service. It started after the pension plan was closed to new entrants.

This employer contribution is not tied to the employee’s 401(k) deferrals and is always 100% vested. It effectively replaces the pension for newer employees by contributing an extra percentage of salary into their 401(k). For instance, a longtime non-union employee might get, say, 5% of pay each year as a UPS Retirement Contribution on top of any SavingsPLUS match.

Investments of Match: Prior to 2023, UPS’s matching contributions were made in shares of UPS Class A common stock by default. This meant employees’ match money was invested in UPS stock unless they moved it.

Starting in 2023, UPS changed to contribute the match in cash (which then gets invested per the employee’s current 401(k) investment elections). This gives employees more flexibility and avoids over-concentration in UPS stock. (Employees can still choose to invest in UPS stock, but it is no longer the automatic funding for the match.)

Summary of UPS 401(k) Match (Non-Union Employees):

Note: All UPS employee contributions (including pre-tax, Roth, and after-tax) are eligible for the match under the current plan, but catch-up contributions (for age 50+ participants beyond the basic IRS limit) are not matched.

After-tax (non-Roth) contributions, if allowed, only became match-eligible starting 2023 when the match changed to cash.

Example – UPS Match Calculation: Suppose a UPS management employee hired in 2020 earns $60,000/year and contributes 6% of salary ($3,600) to the 401(k). UPS will contribute 50% of that, up to 6% of pay. The employee contributed the full 6%, so UPS adds an extra 3% of salary = $1,800 as the match.

If the same employee only contributed 4% ($2,400), UPS would match 50% of 4% = 2% of pay ($1,200). The key is to contribute at least 6% to get the maximum UPS match of 3% in this scenario. All of UPS’s contributions vest immediately, so the employee is guaranteed to keep that $1,800 match regardless of future tenure.

Historical Changes in UPS’s 401(k) Plan

UPS’s retirement benefits have evolved over time, shifting more emphasis to the 401(k) as pensions wane:

• Pre-2008: UPS’s primary retirement vehicle for many was a pension (UPS provided a defined benefit plan for non-union employees, and union employees have multi-employer Teamsters pensions).
• The 401(k) match at that time was 50% up to 5% for non-union staff. This modest match supplemented the pension.
• 2008: UPS enhanced the match for new hires, offering a dollar-for-dollar 3.5% match for those hired 2008–2016.
• This coincided with changes in the pension formula and was likely meant to boost the 401(k) component of retirement.
• 2016: UPS closed its defined benefit pension plan to new non-union hires as of July 1, 2016. To compensate, UPS adjusted the 401(k) plan. New hires from mid-2016 onward got a higher potential match threshold (6% vs 3.5%), although at a 50% rate.
• Additionally, UPS introduced the UPS Retirement Contribution (3–8% of pay) for those employees. These changes effectively shifted UPS’s retirement plan from a pension-centric model to an enhanced 401(k) model for new employees.
• 2023: UPS stopped funding the match exclusively in company stock and began depositing it in cash to employees’ accounts. This was a significant change reducing investment risk for employees.
• UPS also extended matching to after-tax contributions and increased auto-enrollment escalation from 10% to 15% max, reflecting a trend of encouraging higher savings rates.
• Union Plan Context: Throughout these changes, the union-represented workforce (UPS drivers, etc.) continued to negotiate pension benefits via their union contract. UPS contributes a substantial amount (reportedly “$27k a year in the West” for some full-time drivers) to the pension fund instead of offering a 401(k) match.
• This is a trade-off determined by collective bargaining – union employees prioritize a defined benefit pension, whereas non-union employees rely on the 401(k) with match.

UPS’s shift mirrors broader corporate trends. Traditional pensions are costly and less common (especially for non-union employees). Companies have moved to beef up 401(k) plans to stay competitive in recruitment.

A higher 401(k) match (and contributions like UPS’s Retirement Contribution) gives employees more portable retirement savings, which is attractive to a modern workforce that values immediate control of retirement funds.

For example, UPS’s competitor FedEx made a similar move in 2020–2021 by closing its pension to new hires and significantly raising its 401(k) match to attract talent.

Federal Laws Governing 401(k) Contributions

401(k) plans, including employer matches, are regulated primarily by federal laws – chiefly the Employee Retirement Income Security Act (ERISA) and the Internal Revenue Code. Key rules include:

• Tax Advantages & Limits: Employee salary deferrals to a 401(k) are tax-deferred (traditional) or tax-free growth (Roth). The IRS sets an annual cap on employee elective deferrals ($22,500 in 2023; $23,000 in 2024).
• Participants aged 50 or above can contribute additional “catch-up” amounts ($7,500 extra in 2023). Employer contributions (matches or other) do not count against the employee’s deferral limit, but total combined contributions (employee + employer) have an overall limit (in 2023, the total annual addition limit was $66,000, or $73,500 if including catch-ups) under IRS rules.
• Nondiscrimination and Safe Harbor: 401(k) plans must not disproportionately benefit highly compensated employees. To pass annual nondiscrimination tests, employers can either ensure that contribution rates between high and low earners are within certain bounds (the ADP/ACP tests), or adopt a safe harbor design.
• A common safe harbor is providing a minimum employer match (e.g. 100% of the first 3% and 50% of the next 2% of pay) that automatically satisfies fairness rules. UPS’s plan is not designated as safe harbor (it likely still undergoes testing), but companies like FedEx and Walmart with generous match formulas essentially meet safe harbor provisions and thus avoid certain tests.
• Vesting Requirements: By law, employee contributions are always 100% vested immediately. Employer matching contributions can be subject to vesting schedules, but must vest at least as quickly as a 3-year cliff or 6-year graded vesting at maximum.
• This means an employer could require up to three years of service before any match is owned (cliff vesting), or gradually vest a portion of match each year (graded, typically 20% per year starting after year 1, reaching 100% by year 6). Some plans (often safe harbor plans) choose to immediately vest the match 100% to simplify and to attract employees.
• UPS’s non-union plan voluntarily uses immediate vesting for its match, which is more generous than required.
• Eligibility: Federal rules allow a 401(k) plan to require up to 1 year of service (and age 21) before an employee is eligible to receive employer contributions.
• However, many employers, including UPS for its non-union plan, let employees contribute and receive match from hire.
• In contrast, Walmart and Amazon impose a 1-year wait for matching (which is within legal limits). Companies cannot require more than 2 years for eligibility to contribute or for safe harbor contributions.
• Contribution Types: Employers can match employee contributions whether they are pre-tax 401(k) or Roth 401(k). But note that employer matches are always contributed on a pre-tax basis.
• Even if an employee contributes Roth (after-tax) dollars, the matching funds from the company go into a traditional (pre-tax) 401(k) account on behalf of the employee.
• The employee will pay taxes on those matched dollars upon withdrawal in retirement. (This is why, for instance, Walmart’s plan notes that matching contributions on Roth or after-tax deposits “will owe taxes at withdrawal”.)
• Withdrawal Rules: 401(k) funds (employee or employer contributions) generally cannot be withdrawn before age 59½ without penalty, except for certain hardships or plan loans, etc.
• Also, at retirement or termination, employees can typically roll over their 401(k) to an IRA or new employer plan. These rules are uniform across states due to federal law.

State-Level Nuances: Retirement plans like the 401(k) are predominantly governed by federal law, meaning state differences are minimal. However, a few state-related points:

• State Tax: Most states follow federal tax treatment for 401(k) contributions (i.e., no state income tax on traditional 401(k) contributions, and taxing withdrawals in retirement).
• A few states may tax 401(k) contributions or exempt certain retirement incomes differently. For example, Pennsylvania doesn’t tax retirement distributions, and New Jersey taxes 401(k) contributions upfront. California and others have state income tax on withdrawals. These can affect the net benefit depending on where you retire.
• Creditor Protection: Federal law (ERISA) protects 401(k) assets from creditors in bankruptcy in all states. Additionally, most states also protect 401(k) and other retirement funds from civil judgments, with some variations in extent.
• Community Property: In community property states, 401(k) assets accumulated during marriage may be considered joint marital property in divorce proceedings.
• State-Mandated Retirement Programs: A growing number of states require employers without a 401(k) to auto-enroll employees in a state IRA program. This doesn’t affect UPS, since UPS has its own plan. But it reflects states’ interest in expanding retirement coverage.

Overall, UPS’s 401(k) plan must comply with IRS contribution limits and ERISA standards, just like FedEx, Amazon, Walmart and others. UPS’s immediate vesting policy for the match exceeds the minimum legal requirement, which is a favorable feature for employees.

Comparison: UPS vs FedEx vs Amazon vs Walmart 401(k)

All four companies are large employers but with varying retirement benefit philosophies. The table below compares their 401(k) matching policies and key features:

Key Differences:

• Generosity of Match: FedEx’s new match (up to 8% of pay) is the highest of these, while Amazon’s 2% effective match is the lowest. UPS’s max (3% for recent hires, or 3.5% for those hired 2008–2016) is middle-of-the-road, but UPS also provides the extra retirement contribution (3–8% of pay) which can make the total employer contribution quite substantial over time. Walmart’s 6% match is very competitive and straightforward.
• Waiting Period: UPS (non-union) and FedEx allow immediate participation and matching upon hire for most employees. Amazon and Walmart make employees wait one year before they start receiving matching dollars (though employees should still contribute in that first year to build savings and, in Amazon’s case, to ensure they’re enrolled for match later).
• Vesting Schedules: Amazon stands out for having a long cliff vesting – employees who don’t stay 3 years forfeit all matching funds, which is a major drawback for high-turnover environments. UPS, Walmart, and likely the new FedEx plan vest matches immediately (so even if an employee stays a short time, they keep the company contributions).
• FedEx’s move to an 8% match suggests it’s structured to be fully vested to meet safe harbor rules (though we assume this; their prior plan might have had a short vesting period but FedEx hasn’t publicized vesting issues like Amazon).
• Pension or Extra Contributions: UPS (union) and FedEx (pre-2020 hires) have pensions in addition to or instead of 401(k) match. UPS (non-union) provides an automatic contribution (3–8%) for pension replacement. Walmart and Amazon do not have traditional pensions, so the 401(k) is the primary retirement plan for employees.
• Company Stock: UPS historically matched in stock (which could be a pro if UPS stock performed well, but also a risk and less flexible). FedEx and Amazon match in cash (Amazon’s match goes into whatever investments the employee chooses; Amazon’s plan is administered by Fidelity, giving many fund options).
• Walmart’s match is also in cash to your account (and you direct the investments). None of these companies require employees to invest their own contributions in company stock, though UPS and FedEx offer it as an option among the plan’s funds. It’s generally advised not to hold an outsized portion of retirement savings in your employer’s stock to avoid concentration risk.

Pros and Cons of UPS’s 401(k) vs Competitors:

UPS 401(k) Strengths:

• Immediate Vesting: UPS’s match is yours to keep right away – a valuable feature not all companies offer (Amazon’s policy contrasts sharply here). This ensures UPS employees don’t lose retirement money if they change jobs.
• No Waiting for Match: Non-union UPSers get match from day one of participation. This is better than Amazon/Walmart’s 1-year delay.
• Additional UPS Contributions: The extra 3–8% UPS Retirement Contribution for newer hires is a major boost that rivals a safe harbor nonelective contribution. It’s essentially “free” retirement money even if an employee isn’t contributing enough to get full match. Over time, this can significantly increase savings.
• Auto-Enrollment at Healthy Rate: Starting employees at 6% auto contribution (and escalating) helps them capture the full match and build a habit of saving.
• Plan Flexibility: UPS allows pre-tax, Roth, and after-tax contributions, giving flexibility in tax planning. Also, after 2023, the company match no longer forces company stock, which improves diversification options for employees.

UPS 401(k) Drawbacks:

• Lower Match % (for some) Compared to Peers: For post-2016 hires, UPS’s effective 3% of pay match is half of what Walmart provides (6%) and much lower than FedEx’s 8%. Even pre-2016 hires at UPS max out at 3.5%. So in pure matching dollars, UPS could be seen as less generous than some competitors. However, UPS’s retirement contribution partly compensates for this.
• Complexity & Legacy Differences: The tiered match based on hire date can be confusing for employees, and it means colleagues have different benefit formulas. Also, union vs non-union differences can cause confusion (new hires might hear “UPS has no 401k match” which is true if they’re referring to union positions, but not true for management roles).
• No Match for Union Employees: While union employees have a pension (a pro), they miss out on the flexibility and potential portability of a 401k match. Younger employees who don’t stay until pension vesting could find they benefited less. However, UPS Teamsters do vest in their pension after a certain number of years, and many value the guaranteed income a pension provides.
• Historically Company Stock Match: Until it changed, the UPS match in stock could be a downside if an employee wasn’t aware – holding only UPS stock could be risky if the stock underperformed. Now that it’s in cash, this is mitigated.
• Lower Immediate Cash Compensation: Because UPS allocates significant resources to pensions (for union) and retirement contributions, one could argue it slightly lowers cash wages or other benefits in the short term. But as a retirement benefit trade-off, it’s usually positive for long-term wealth.

In contrast, FedEx now offers a very high match (especially attractive to new hires post-2020), but existing employees had to choose between keeping a pension vs moving to the new plan.

Amazon offers a smaller match and uses vesting to often recoup those funds when employees leave early – Amazon’s workforce has historically high turnover in fulfillment centers, meaning many employees likely leave before 3 years and forfeit matches (in one study, Amazon reclaimed over $100 million in forfeited match funds in a single year).

Walmart provides a robust 6% match with immediate vesting, which is a strong benefit for its industry, though the one-year wait can cause some employees to miss out if they leave within a year.

Impact of 401(k) Matches on Long-Term Retirement Savings

Employer matching is often referred to as “free money” and can significantly boost an employee’s retirement nest egg over time. Consider a simplified scenario: an employee earning $50,000 who contributes 6% ($3,000) a year, and whose employer matches 50% up to 6% (a $1,500 annual match, like UPS’s current plan for new hires).

That $1,500 yearly match, invested over 30 years with compounded growth, could add well over $250,000 to retirement savings (assuming ~7% annual investment returns). Essentially, the employer’s contributions growing over decades can produce a substantial portion of the total 401(k) balance at retirement.

Matches also serve as an incentive: studies have found that higher match rates increase employee participation in 401(k) plans and encourage employees to contribute at least up to the match threshold.

For example, when a company offers a generous match like FedEx’s 8%, employees are highly motivated to contribute at least 6% to get the full benefit. On the other hand, if no match is offered, participation rates and contribution levels tend to be lower (employees feel they’re missing an incentive).

However, the structure of the match can influence behavior:

• A dollar-for-dollar match up to a certain percent (like Walmart’s 6%) is straightforward and many employees will contribute at least that 6%.
• A 50% partial match (like UPS’s 50% up to 6%) means an employee might perceive the benefit differently – they have to put in $2 to get $1 from the employer. It’s still highly beneficial to do so, but some might not feel as “rewarded” as a 100% match. Even so, it’s rational to contribute enough to get the full match since it’s a 50% immediate return on that contribution.
• Cliff vesting (like Amazon’s) can unfortunately erode the long-term impact for employees who don’t stay. If an Amazon employee leaves after 2 years, they effectively got zero from the employer, missing what could have been a growing sum. Those who stay past 3 years at Amazon will get their accrued matches, which then can compound going forward.

For UPS employees specifically, the presence of the pension for union folks and the extra UPS Retirement Contribution for newer non-union employees means their retirement outcome isn’t just the 401(k) match. Those additional benefits can be sizable.

For instance, a UPS non-union employee with 20 years of service might be getting a 5% of pay retirement contribution each year (assuming a mid-range of the 3–8% scale), which invested over a career along with personal contributions and match, leads to a very solid 401(k) balance.

The combination of match + additional contributions + one’s own contributions, all compounding tax-deferred, underscores how valuable these programs are.

One should also note the power of vesting and portability: A fully vested 401(k) match (like UPS’s) is effectively like extra salary that you can take with you if you change jobs.

A pension typically requires many years of service to earn a meaningful benefit and cannot be “taken” as a lump sum (in most cases) until retirement age. Thus, for a mobile workforce, a good 401(k) match plan can be more beneficial in the long run.

Evidence in Practice: Many financial advisors illustrate that consistently contributing enough to get the full employer match is one of the best moves employees can make. For example, advisors have shown that employees who maximize their employer match accumulate significantly higher balances over time than those who don’t.

Simply put, a match is part of your compensation – if you don’t take full advantage, you’re leaving money on the table that could be growing for you.

In the case of Amazon, the forfeitures of unvested matches have even raised concerns academically and legally. An academic analysis in 2024 highlighted that over 1.8 million U.S. workers forfeited employer 401(k) contributions in a single year due to vesting schedules, and singled out Amazon and Home Depot as top offenders using vesting to save costs.

Those forfeited dollars (like Amazon’s $102 million in one year) are essentially lost compound growth for the employees who left. Meanwhile, companies like UPS and Walmart that immediately vest matches show that it’s possible to provide retirement benefits that truly stick with employees.

This can lead to better long-term retirement preparedness, especially for workers who may change jobs frequently.

Common Pitfalls and Tips for Employees

Even with a solid 401(k) plan available, employees should be mindful of some common pitfalls to avoid reducing their retirement benefits:

• Not contributing enough to get the full match: This is the classic mistake – if your employer matches contributions up to a certain percent, at minimum contribute that percent.
• For instance, a UPS non-union employee should aim for at least 6% deferral to capture the full company match. Failing to do so is essentially leaving free money unmatched. If finances are tight, start lower and increase gradually (UPS’s auto-escalation can help with this).
• Contributing too much, too early (and missing match): Ironically, contributing too large a percentage early in the year can cause some to max out the IRS limit before year-end, potentially missing out on match in later pay periods. Some employers only match per paycheck; if you stop contributing once you hit the limit, those last paychecks get no match. Check if your plan has a true-up feature.
• A true-up is an end-of-year adjustment some plans do to ensure you still get the full entitled match even if your contributions weren’t spread evenly. If no true-up, it’s wise to spread contributions throughout the year or at least ensure each pay period up to the match percentage.
• UPS’s plan makes matching contributions each quarter and indicates you do not have to be employed at quarter-end to get the match for that quarter, which is good. It effectively acts like a quarterly true-up. Still, ensure you contribute consistently each quarter.
• Leaving before vesting (if applicable): While UPS and Walmart have immediate vesting, companies like Amazon require 3 years. If you’re at 2.5 years at Amazon, for example, it might be worth aiming to stay until 3 to secure your accrued match.
• Don’t let a vesting schedule alone dictate life decisions, but be aware of what’s at stake. At Amazon, leaving even one month early could forfeit thousands of dollars.
• Cashing out or taking loans after leaving: When changing jobs, some employees cash out small 401(k) balances, which triggers taxes and penalties, eroding retirement savings.
• Always consider rolling over into an IRA or the new employer’s plan to keep the money growing tax-advantaged. Similarly, borrowing from your 401(k) should be a last resort – if you leave the company, the loan typically becomes due; if not repaid, it’s a withdrawal subject to penalties.
• Not diversifying investments (company stock risk): UPS employees previously often ended up with UPS stock from matching. While having some company stock can be fine, be careful about over-concentration.
• If your own contributions heavily favor UPS stock (or any single stock), you carry extra risk. It’s generally recommended to have a diversified portfolio in your 401(k) (e.g., a mix of equities, bonds, or target-date funds).
• UPS now matches in cash, but employees still direct investments. Review your allocations periodically to ensure they match your risk tolerance and retirement timeline.
• Ignoring fees and fund choices: Large plans like those at UPS, FedEx, Amazon, and Walmart typically have low-cost index fund options, but always double-check the expense ratios of your fund choices. High fees can eat into returns over decades.
• Make use of any index funds or target-date funds provided (UPS’s default is a target retirement fund). Also, consider the benefit of Roth 401(k) vs traditional for your situation – young employees in low tax brackets might benefit from Roth (tax-free later), whereas higher earners might prefer the immediate tax break of traditional.
• Relying solely on pension (for those who have one): If you’re a UPS union employee with a pension, it might be tempting to not save additionally. But most financial advisors would still encourage contributing to a 401(k) or IRA on your own.
• Pensions can change, and having a supplemental pool of savings is wise. Plus, your 401(k) (or IRA) can provide lump sum flexibility in retirement that a pension (fixed monthly payment) doesn’t.
• Forgetting Beneficiary Updates: Ensure you designate a beneficiary for your 401(k). Life events (marriage, divorce, etc.) should prompt an update. This isn’t a “financial” pitfall per se, but it’s important – 401(k) beneficiary designations will override wills in many cases, so keep them current to avoid legal headaches for your heirs.

By being aware of these issues, employees can fully leverage UPS’s 401(k) and similar plans. For example, a new UPS employee might not realize they need to actively enroll or set their contribution rate. With auto-enroll, they’ll be in at 6%, but they should still confirm and perhaps even increase the rate if they can afford to.

Taking full advantage of the match and extra contributions, avoiding early withdrawals, and investing wisely can mean the difference between a modest retirement fund and a comfortable one.

FAQs: UPS 401(k) and Employer Match

Below are some frequently asked questions about UPS’s 401(k) matching policy and related retirement plan details, answered concisely:

Q1: Does UPS offer a 401(k) match to employees?
A1: Yes. UPS offers a 401(k) match for non-union employees. The match ranges from 3% to 3.5% of pay, depending on hire date, based on employee contributions.

Q2: Do UPS union employees get a 401(k) match?
A2: No. Union-represented UPS employees (Teamsters) do not receive a 401(k) match. Instead, UPS contributes to a union pension plan on their behalf.

Q3: What is UPS’s 401(k) match percentage for new hires?
A3: For UPS non-union hires after July 1, 2016, the company matches 50% of your contributions, up to 6% of your pay. This effectively maxes out at a 3% of pay employer contribution.

Q4: When do I become eligible for UPS’s 401(k) match?
A4: Immediately upon hire for UPS non-union employees. There is no waiting period – you can receive matching contributions from your first paycheck with 401(k) deferrals.

Q5: Is UPS’s 401(k) match immediately vested?
A5: Yes. UPS’s matching contributions are 100% immediately vested. You do not lose the match if you leave the company, unlike some plans with vesting schedules.

Q6: How much should I contribute to get the full UPS match?
A6: Contribute at least 6% of your salary if you’re a recent UPS hire. UPS will then contribute the maximum 3% (50% of 6%) as a match. Contributing less means a smaller match.

Q7: Does UPS match Roth 401(k) contributions?
A7: Yes. UPS will match your contributions whether traditional pre-tax or Roth. The match money goes into a pre-tax account, even if your contribution was Roth.

Q8: What is the UPS Retirement Contribution?
A8: It’s an automatic employer contribution (3%–8% of pay) UPS makes to the 401(k) for eligible non-union employees. It’s in addition to the regular match, based on your years of service.

Q9: Can part-time UPS employees enroll in the 401(k)?
A9: Yes. Part-time employees, if non-union, can participate in UPS’s 401(k) plan under the same terms. They can contribute and receive the match (no hour service requirement is specified for eligibility).

Q10: Did UPS’s 401(k) match change recently?
A10: Yes. Effective 2023, UPS’s match is now deposited in cash instead of UPS stock. The match formula for new hires (50% up to 6%) has been in place since 2016, when it replaced an older formula.

Q11: How does UPS’s match compare to FedEx’s?
A11: FedEx currently offers up to an 8% match (if you contribute 6%), which is higher than UPS’s 3% (for the same 6% contribution). However, UPS provides an extra retirement contribution.

Q12: Does UPS 401(k) have a vesting schedule?
A12: For the company match and retirement contributions, no – they are fully vested immediately. (Any UPS pension benefits, for union workers, have their own vesting rules separate from the 401k.)

Q13: What are the 401(k) contribution limits at UPS?
A13: UPS follows IRS limits. In 2023, you could defer up to $22,500 (under 50) or $30,000 (50+ with catch-up). These limits apply across all 401(k) plans per person.

Q14: Does UPS’s match count toward the IRS limit?
A14: No. Employer contributions are separate. However, total contributions (employee + employer) cannot exceed the annual additions limit (e.g., $66,000 in 2023, excluding age-50 catch-ups).

Q15: Are after-tax contributions matched by UPS?
A15: Recently, yes. As of 2023 UPS will also match voluntary after-tax (non-Roth) contributions up to the same cap. Previously, after-tax contributions were not matched.

Q16: What happens to my UPS 401(k) if I quit?
A16: Your own contributions and any vested employer contributions stay in your account. Since UPS’s match is vested immediately, you keep it. You can leave it in the plan, roll it over, or withdraw (taxes/penalties may apply).

Q17: Does UPS 401(k) allow loans or hardship withdrawals?
A17: Yes. UPS’s plan allows loans (for certain purposes) and hardship withdrawals as permitted by IRS rules. Taking these can impact your savings, so consider carefully.

Q18: How are UPS’s matching contributions invested?
A18: As of 2023, UPS matches in cash to your 401(k) account. The cash will be invested according to your current investment elections (e.g., your selected funds). Previously, matches were invested in UPS stock by default.

Q19: When does UPS deposit the matching contributions?
A19: UPS makes its SavingsPLUS matching contributions quarterly. At the end of each calendar quarter, UPS calculates and contributes the match for that quarter’s contributions. You need not be employed on the final day of the quarter to receive that quarter’s match.

Q20: What is “SavingsPLUS” in the UPS plan?
A20: “SavingsPLUS” is UPS’s term for its 401(k) matching program. It refers to the employer match on your contributions. UPS also uses terms like “UPS Retirement Contribution” for its non-match employer contributions.

Q21: I’ve heard UPS has a pension – how does that factor in?
A21: UPS provides a pension for Teamsters (union employees) and had a pension for non-union employees hired before 2016. If you are covered by that, it’s separate from the 401(k). Non-union hires after 2016 get the enhanced 401(k) (match + retirement contribution) instead of a traditional pension.

Q22: Can I contribute to both a 401(k) and an IRA?
A22: Yes. You can contribute to an IRA (traditional or Roth) on your own, in addition to your UPS 401(k). Income limits may affect the deductibility of traditional IRA contributions if you’re covered by a 401(k).

Q23: What are catch-up contributions and does UPS support them?
A23: Catch-up contributions are extra deferrals allowed for those aged 50+. UPS’s plan permits catch-up contributions (additional 401k contributions beyond the normal limit). These catch-ups are not matched by UPS, but they do allow older employees to save more tax-advantaged money for retirement.

Q24: Does UPS offer a Roth 401(k) option?
A24: Yes. UPS’s plan allows Roth 401(k) contributions (after-tax contributions that grow tax-free). You can choose pre-tax, Roth, or a combination. The employer match will still be pre-tax.

Q25: How does the UPS match work with Roth contributions?
A25: If you contribute to a Roth 401(k), UPS will still calculate the match on those contributions and deposit it into a pre-tax account for you. So you’ll have a Roth account (your money) and a traditional account (UPS match).

Q26: Is there a limit to the percentage of my salary I can contribute?
A26: UPS allows contributions up to 50% of your eligible pay each pay period (subject to annual IRS dollar limits). Just ensure you don’t hit the annual maximum too early and miss out on matching later in the year.

Q27: I’m a new UPS hire; should I do 6% to the 401(k) or pay off debt?
A27: It’s often recommended to contribute at least enough to get the full match (6% for UPS) because of the immediate 50% return via matching. High-interest debt (e.g., credit cards) should also be prioritized. A balanced approach can work: get the match while paying down debt aggressively.

Q28: Can I roll over an old 401(k) into UPS’s plan?
A28: Yes. UPS’s 401(k) plan accepts rollover contributions from other qualified plans or IRAs. This can consolidate your retirement accounts, but weigh the investment options and fees of each plan before deciding.

Q29: Does leaving UPS affect my pension or 401(k) differently?
A29: If you’re non-union, leaving UPS means no more UPS contributions, but your 401(k) (including all vested funds) remains yours. If you’re a union employee with a pension, leaving before a certain number of years could impact your pension vesting or amount. The 401(k) portion (if you had one) would still be yours to keep or roll over.

Q30: How do UPS’s retirement benefits rank overall?
A30: UPS offers a strong overall package: a 401(k) with match and extra contributions for non-union staff, and a pension for union staff. The match percentage is moderate, but the immediate vesting and additional UPS-funded contributions are major pluses. Some competitors offer higher matches (FedEx, Walmart) or stock perks, but UPS’s combination of pension (for some) and 401(k) makes it quite competitive in the industry.