Savings & Retirement
Good financial health is just as important as good physical health and saving for current and future needs is an important consideration for all of us. It allows us to enjoy greater security, protecting us from financial emergencies, preparing for large purchases and building a nest egg for retirement. Through the 401(k), you have more ways to save to shore up your financial future.
Through the Pearson Retirement 401(k) Plan you can save up to 50% of your pay and reap the benefits of a generous company contribution.
Employee 401(k) Plan Contributions
You can contribute 1%–50% of your eligible compensation, up to the annual Internal Revenue Service (IRS) contribution limit ($23,500 in 2025) or compensation limit ($350,000 in 2025), whichever is met first. Under the 401(k), you can make pre-tax contributions, Roth contributions and/or true after-tax contributions.
Pre-tax contributions are automatically deducted from your paycheck each pay period before Federal, and most state income taxes have been taken. You do not pay taxes on pre-tax contributions until you receive them as a distribution when you retire. In contrast, Roth 401(k) contributions are deducted from your pay after income taxes have been taken. However, you will not pay additional taxes on Roth 401(k) contributions or the investment earnings when they are distributed from the Plan, provided you meet certain criteria.
After-tax contributions are not eligible for the employer match and there are no limits on how much you can contribute. Withdrawal of your after-tax contributions is not taxed however, earnings are taxed upon withdrawal.
If you do not enroll within 30 days of becoming eligible, you will be automatically enrolled at a pre-tax contribution rate of 6% of your eligible compensation.
You are 100% vested in your contributions. The value of your contributions and earnings are yours when you leave the company, regardless of your years of service.
Employer Matching Contributions
Pearson matches dollar for dollar on the first 3% of your pre-tax contribution election plus $0.50 for every dollar on the next 5% of you pre-tax or Roth contribution election. Said otherwise, if you contribute 8% of your eligible compensation, Pearson will contribute 5.5% to your account. The Pearson match will go into your pre-tax account regardless if you choose pre-tax or Roth contributions. This means you will pay taxes on the Pearson match.
You are 100% vested in Pearson’s contributions after three years of service. (Between 1–2 years of service you are 33–1/3% vested, and between 2–3 years of service you are 66–2/3% vested).
The Empower Student Debt Solution powered by Candidly
When you enroll in the program, Pearson will match your qualified student loan payments with contributions to your 401(k) plan account. Pearson matches the first 3% of your contributions at 100% and the next 5% at 50%—up to 5.5% total match when you save 8% of your earnings. You can reach the total match through direct contributions to the 401(k) Plan, qualified student loan payments, or a combination of both!
- Eligibility: If you have outstanding student loan debt and aren’t contributing enough to get the full company match, this benefit is for you.
- Loan types covered: This includes payments on federal and private student loans, Parent PLUS loans, and even loans for which you are a cosigner for a spouse or dependent.
- Match amount: The maximum amount Pearson will contribute to your 401(k) account will equal 5.5% of your eligible 2025 compensation, which is paid in Q1 2026. This benefit means you will not to miss out on the 5.5% company match if you are making routine student loan payments. The payout could be less, depending on 1) your debt amount paid off and 2) how much you have saved in the 401(k) plan during the year up to the point of calculation.
To enroll in the Student Loan Debt Solution, log on to empower.com/pearson, navigate to “Planning” and then click on “Student Debt Solution.”
Watch this video to see the tools in action.
If you have any questions about Candidly, please call 1-866-719-3437 or email [email protected], Mon – Fri, 9 am to 8 pm Eastern.
401(k) Contribution and Compensation Limits
You make pre-tax and/or Roth contributions to the Plan during the year. Contributions made by Pearson do not count toward the annual contribution and compensation limits. These limits for 2025 are:
- Contribution Limit – $23,500
- Compensation Limit – $350,000
Catch-up Contribution Limit: If you attain age 50 during the 2025 calendar year, you may contribute an additional $7,500. New for 2025: participants who reach age 60 to 63 in 2025 can contribute an additional $11,250 instead of the $7,500! After you contribute the maximum regular contribution allowed for the year, your catch-up contribution will begin. Catch-up contributions are not eligible for the employer match.
The Pearson Retirement 401(k) plan is administered by Empower Retirement. Visit Empower Retirement online or by calling 1-844-465-4455. For additional information/guidance on retirement planning please visit the Empower Retirement Wellness and Financial Center.
As a retiree of Pearson, you may be eligible to participate in the Company’s Retiree Medical and/or Pension plans. Review the Pearson Retiree brochure (PDF, 152 KB) to see if you are eligible and read a brief description of the plans offered.