Medicated Money

Tuesday, August 08, 2006

Employers, Employees, & 401(k) Participation

The need to get more workers involved in their retirement plan at work is a difficult task for most employers. From a personal standpoint, we fell into this category for 3 years. Less than one year ago for us, we were serious debating whether or not to put money into our 403(b). The reason for not contributing was that we seriously thought we could not live with reducing our take-home pay. The scary thing is it looks like we were not alone. Like many individuals, procrastination and the inability to live below your means was a stronger force than the fear of retiring without a financial plan. Luckily for us, we learned early from our mistakes and have completely changed our financial future.

It now looks like many employers who are worried about their employees are trying to change those employees financial future as well! This is an excellent article that discusses this fact.

Employers getting creative with 401(k) participation

With the extinction of traditional pensions, many employers know that the only retirement salvation for employees will be their 401(k). Due to this, many employers are making contributions mandatory. I agree with this plan of making contribution mandatory. I also believe that workers should be educated about the importance of these plans and what it will eventually mean to their financial future. If employers do not educate their employees, many workers will be lost in the financial confusion.

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