Companies reinstate 401(k) (matching) contributions [View all]
Most employers that cut back on matching 401(k) contributions during the recession are now reinstating the match.
Of 260 companies that discontinued or reduced their 401(k) matching contributions in the downturn, 75 percent have now restored them, says consultant Towers Watson. Most companies, 74 percent, reinstated at the previous level, while 23 percent restored at a lower level and 3 percent actually boosted their match.
A company match is key in getting employees to participate in retirement plans because it is a no-cost way to add to a worker’s nest egg, Towers Watson says. The most common employer 401(k) match is 50 cents for every $1 contributed, up to 6 percent of worker’s pay, Towers Watson says. A $1-for-$1 match up to 3 percent also is common.
Yet nearly 30 percent of plan participants are not contributing enough to get the full company match, says Aon Hewitt. Employees who don’t contribute enough to receive the full company match are “leaving free money on the table,” says Gerri Walsh, vice president of investor education at the Financial Industry Regulatory Authority.
more: http://www.greenbaypressgazette.com/article/20111205/GPG03/111205008/Companies-reinstate-401-k-contributions?odyssey=nav%7Chead
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