Costco Helps Thousands of Workers Build $1 Million Nests Eggs With 4% to 9% 401(k) Contributions
Updated
Updated · Entrepreneur · Jul 21
Costco Helps Thousands of Workers Build $1 Million Nests Eggs With 4% to 9% 401(k) Contributions
1 articles · Updated · Entrepreneur · Jul 21
Summary
Thousands of Costco hourly workers have built retirement balances above $1 million, helped by automatic company 401(k) contributions even when employees save nothing themselves.
Costco puts in 4% of pay after one year of service, with the contribution rising to 9% after 25 years—part of a strategy to keep experienced workers.
Other employers are even more generous: Southwest matches contributions dollar-for-dollar up to 9.3%, Visa contributes $2 for every $1 saved up to 5% of pay, and unionized Ford and GM workers get 10% with no match required.
Stock-based plans can produce similar results: Publix grants shares after 1,000 work hours in a year, while Stewart’s Shops says more than 200 cashiers became millionaires through its ESOP alone.
The broader pattern is that companies are using rich retirement benefits not just as perks but as retention tools in businesses that depend on long-tenured workers.