According to news reports, employees will keep the pension benefits they have earned to date; however, workers will no longer accumulate new benefits into the fund.The company is moving to a 401(k) retirement plan for most of its employees. The company currently matches contributions of eligible workers up to 5% in the 401(k) plan; however, starting on July 1, the company will start contributing funds into workers’ 401(k) plans, regardless of whether they contribute to the plan. The company will contribute 2% to 3% of a worker’s salary into the 401(k) plan.
This is additional evidence that the 401(k) plan is no longer a supplement to a pension plan but rather the sole source of retirement for most Americans.
Please comment or call to discuss how this will affect you and your company retirement plan.
- The Difference an Adviser Can Make (401kplanadvisors.com)
- Benchmarking: The Key to a 401k Plan Sponsor’s Fiduciary Compliance Review (401kplanadvisors.com)
- How to determine if a cash balance pension plan is right for your company (401kplanadvisors.com)