I would like to know - assuming all other things being equal (fund choices, fees, annual returns, etc) given this scenario, which one comes out ahead, and how do you calculate this?
Company A has a 6% match to an employee's 401(k) but only contributes this match at the end of their fiscal year in a lump sum.
Company B has a 4% match (technically 100 of the first 3 and 50% of the next 2), but they add the fraction of this match on each pay cycle (every two weeks).
Without understanding the calculations behind it, I could see how the 4% could come out ahead, because contributions through the year would be purchasing as the year went along, but could it outperform the higher percentage at the end of the year?
An additional assumption is that employee contributions at both companies would be equal and would at least be enough to capture the full match. Thanks for explaining how to figure this out.