401(k)s: Remember Them?

[LiberalFighter]

401(k)s: Remember Them?
Washington Post

Remember all those jokes about workers who could no longer stand to look at their 401(k) balances and had stopped bothering to even open their account statements?

It turns out they weren't entirely jokes. And for a lot of workers they certainly weren't funny.




The result, according to experts at Hewitt, is that participation in 401(k) plans dropped to 68.2 percent of workers at the end of 2002, from 71 percent a year earlier, and while the average contribution remained stable at about 7.8 percent of pay, it declined to 6.5 percent among short-tenured and younger (age 20-29) workers.

[Enquiringkitty]

1. And there is no indication that the private plan that Bush wants

won't turn out the same way, leaving all of us holding an empty bag at 65.

There already are private plans....401Ks and IRAs. Why haven't more people put money into them......you've already said that.

Why is Bush pushing private plans so hard?....to make up for all of the people who do not believe in 401Ks anymore. His finance Buddy's need the money input back.

[LiberalFighter]

6. According to the source 68% have 401k's

Those are private accounts.

They won't be able to put any of the SS into their 401k.

[Tux]

2. No one

Retired on them so we'll see if they work or not.

[iamjoy]

3. Other Reason For Declining Participation

is related to this, but to an extent, a separate reason.

People don't know how much to invest or how to invest their money (what funds to pick). In the boom years of the 90's, employees started asking for more fund choices within the 401(k). And their plan sponsors complied.

Now, in uncertain times, people want help deciding how to invest their money (and how much to invest) and the multiple choices confuse a lot of them. And most employers offer little (if any) help because they don't want to get sued if somebody's account tanks.

[gaia_gardener]

4. Everyone I know lost pretty heavily in their 401(k)

I didn't lose too badly, I pulled it out in 2001 and rolled it into an IRA (paying less than 1%). I didn't lose any of my own contributions, but I did lose about 20% overall. My parents lost over 50%. So much for dad's early retirement.

[LiberalFighter]

5. I don't know how much I lost but I moved it to an income fund