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The Case for 401(k) Reform

The onus for retirement planning has shifted squarely onto the shoulders of individuals rather than their employers during the past 20 years, but that doesn’t mean employers have been freed of responsibility in this area. As a growing number of large companies have learned at the business end of a lawsuit recently, employees still expect them to do a good job of managing their 401(k) retirement savings plans.

By July of this year, at least 17 big corporations had been hit with lawsuits alleging they had not paid attention to fees related to administration of their 401(k) plans or had failed to adequately disclose such fees. While the suits have not yet spread to the small and medium-size business sector, analysts say they should serve as a wakeup call at the very least.
Keeping Your Company's 401(k) Program Transparent: With so many Americans depending on 401(k) programs to fund their retirements, it's no surprise that the plans are coming under scrutiny. The same charges of exorbitant fees and lack of transparency that plagued the mutual fund industry are now being leveled at 401(k) programs—only this time it's employers who are bearing the brunt of the criticism. Read more at Entrepreneur.com Read more...
401(k) Stock Notification Rule Implemented: Final Labor Department rules recently issued implement a provision in last year’s pension funding reform law that require employers to notify employees of their right to sell company stock given by their employers as a 401(k) plan matching contribution and reinvest the proceeds into other investment options offered by their plans. Read more...
Those Who Profited from Subprimes Now Suffer Too: The American population is aging fast, and more people will soon be living largely off the proceeds of their 401(k) plans and what is left of fixed-rate pensions. These current and future retirees count on drawing a steady stream of cash from high-rate yields of what they believe to be secure, reliable investments in those plans. They believe this because it's what they’ve been led to believe. But what the subprime meltdown reveals is how much of the income for the middle classes' Golden Years has been resting on a foundation of bad debt—and in some cases, on the exploitation of low-income homeowners. Read more at Mother Jones Read more...