Amazon 401k Match Explained: How the Plan Works in 2025

Planning for retirement can feel overwhelming, especially when you’re focused on day-to-day living expenses. For employees at Amazon, one of the biggest perks of working with such a global giant is access to competitive benefits—including a 401k retirement plan with an employer match.

But what exactly is the Amazon 401k match, how does it work, and how can you make the most of it? In this guide, we’ll walk through everything you need to know about the Amazon 401k plan, from contribution limits to vesting schedules, plus real-world examples to help you understand how much you could be saving for your future.

What Is the Amazon 401k Match?

At its core, a 401k is a retirement savings account that allows employees to contribute a portion of their paycheck, usually before taxes, into an investment plan. Many employers sweeten the deal by offering a “match”—essentially free money that they add to your contributions.

The Amazon 401k match works in a straightforward way: when you contribute to your retirement savings, Amazon contributes as well, up to a certain limit. This ensures employees are rewarded for saving and helps build long-term financial security.

Think of it as a team effort—you put in some, Amazon puts in some, and together you grow a retirement fund that will support you later in life.

How the Amazon 401k Plan Works

Amazon’s retirement plan is managed by Fidelity Investments, one of the largest and most trusted financial service providers in the U.S. Employees can log into the Fidelity portal to view contributions, adjust their investment strategies, and track long-term performance.

Here’s how the process typically works:

Automatic Payroll Deductions: You choose a percentage of your paycheck to contribute.
Employer Match: Amazon adds a matching contribution, up to the company’s stated percentage.
Investment Options: Funds are invested in target-date funds, index funds, and other mutual funds managed through Fidelity.
Tax Treatment: Contributions can be pre-tax (traditional 401k), Roth (after-tax), or after-tax non-Roth contributions.

This structure gives employees flexibility while ensuring that retirement savings grow consistently over time.

Amazon 401k Eligibility Rules

Not every employee can immediately participate in the Amazon 401k match program. The eligibility requirements include:

Employment Duration: New employees may need to complete a waiting period (often 90 days) before being eligible for contributions.
Work Status: Full-time and certain part-time employees are eligible. Temporary and seasonal employees may have different rules.
Age Requirements: Employees must generally be at least 18 years old to participate.

Checking the exact eligibility criteria in your Fidelity account or HR documents is crucial, since Amazon updates its policies periodically.

Amazon 401k Match Contribution Formula

The specific Amazon 401k match can vary, but here’s the typical formula:

Amazon matches 50% of employee contributions, up to 4% of eligible pay.

This means:

If you earn $50,000 a year and contribute 4% ($2,000), Amazon adds 2% ($1,000).
If you contribute less than 4%, you’ll still get 50% of whatever you contribute.
If you contribute more than 4%, Amazon’s match maxes out at that 2% level.

Example:

Employee contributes 3% = $1,500 → Amazon adds $750.
Employee contributes 6% = $3,000 → Amazon adds $1,000 (max).

The key takeaway? Always aim to contribute at least 4% of your pay to get the full match. Otherwise, you’re leaving free money on the table.

Vesting Schedule: When the Money Is Yours

Employer contributions often come with a “vesting” schedule—meaning you only fully own that money after a certain period of service.

For Amazon:

Employee contributions are always 100% yours.
Employer match contributions may vest over a certain number of years.

For example, if Amazon uses a 3-year cliff vesting schedule, leaving the company before 3 years could mean forfeiting some or all of the employer match. If you stay past the vesting period, you keep 100% of both your contributions and Amazon’s match.

Real-life scenario:

Employee leaves after 1 year → Keeps own contributions but loses part of Amazon’s match.
Employee stays 5 years → Keeps everything.

Understanding the vesting rules is crucial before making career or financial decisions.

Amazon 401k Plan Administrator: Fidelity

As the plan administrator, Fidelity manages the Amazon 401k plan. Employees access their accounts through Fidelity’s online portal, which allows them to:

Adjust contribution percentages.
Choose investment options.
Track performance and balances.
Set up automatic contribution increases.

Investment options typically include:

Target-date funds (adjust automatically based on your retirement year).
Index funds (broad market exposure at low cost).
Bond funds (for more conservative investors).

The Fidelity platform makes it easier for employees to personalize their retirement savings strategy.

How Amazon’s 401k Match Compares to Other Companies

Amazon’s 401k match is competitive, but not the most generous in the industry. Let’s compare:

Amazon: 50% match on up to 4% of pay (max 2% company contribution).
Walmart: Up to 6% match.
Costco: Matches 50% of contributions up to 6% of pay.
Google: Dollar-for-dollar match up to $10,000 annually.

So, while Amazon’s plan is solid, employees should be aware that other tech companies offer more generous matches. Still, given Amazon’s other benefits (stock units, healthcare, career growth), the overall package remains attractive.

Strategies to Maximize Your Amazon 401k Match

If you’re an Amazon employee, here are a few smart moves to make the most of your retirement plan:

Contribute at least 4% of your pay. This ensures you get the full Amazon match.
Automate increases. Many employees set contributions to automatically rise 1% each year.
Diversify investments. Don’t just stick with default options—explore index funds and target-date funds.
Use Roth contributions. This adds tax diversification for retirement.
Avoid early withdrawals. Early distributions mean penalties and lost growth.

Common Questions About Amazon’s 401k Plan

Does Amazon automatically enroll employees?

Yes, many new employees are auto-enrolled at a default contribution rate. You can adjust this in your Fidelity account.

Can I change my contributions anytime?

Yes, contribution rates can be changed through Fidelity’s platform at any time.

What happens to my 401k if I leave Amazon?

Your 401k stays with Fidelity. You can leave it there, roll it into a new employer’s plan, or transfer it to an IRA.

Can I roll over my Amazon 401k to another plan?

Yes, rollovers are allowed without tax penalties when done properly.

Does Amazon offer catch-up contributions?

Yes. Employees aged 50 or older can contribute extra amounts beyond the standard IRS limit.

Tax Advantages of the Amazon 401k Match

The Amazon 401k plan offers several tax benefits:

Traditional 401k contributions lower your taxable income today.
Roth 401k contributions grow tax-free for retirement.
Employer match contributions grow tax-deferred until withdrawal.

This combination allows employees to strategically balance taxes now and in retirement.

Amazon 401k Contribution Limits for 2025

According to IRS rules:

Employee contribution limit: $23,000 (under 50).
Catch-up contribution (50+): Additional $7,500.
Total contribution limit (employee + employer): $69,000 (or $76,500 for those 50+).

Amazon’s match counts toward the total, but not the employee’s personal limit.

Real-Life Example: Building Wealth with Amazon’s 401k

Let’s run the numbers.

Employee earns $60,000 annually.
Contributes 6% ($3,600/year).
Amazon contributes 2% ($1,200/year).
Total annual contribution = $4,800.

If invested with an average 7% annual return:

After 10 years → ~$66,000.
After 20 years → ~$183,000.
After 30 years → ~$394,000.

That’s the power of compounding combined with the Amazon match.

Pros and Cons of the Amazon 401k Match

Pros:

Free money through employer match.
Flexible contribution options (pre-tax, Roth).
Fidelity’s trusted platform.
Catch-up contributions for older employees.

Cons:

Vesting rules may delay full ownership of match.
Amazon’s match is lower compared to some competitors.
Limited to investment choices within Fidelity’s lineup.

Final Thoughts: Is the Amazon 401k Match Worth It?

The Amazon 401k match may not be the highest in the industry, but it’s still a strong benefit that helps employees grow their retirement savings. By contributing at least enough to earn the full match, diversifying investments, and sticking with the plan long enough to vest fully, Amazon employees can build meaningful long-term wealth.

If you’re working at Amazon—or considering a job there—the 401k plan is a valuable part of the compensation package that shouldn’t be overlooked.