Companies Start Matching 401(k) Funds Again
BOSTON ( TheStreet) -- After two years of focusing on the bottom line, companies that stopped matching employees' 401(k) contributions plan to restore the benefit this year.
Earlier this month, human resources consultant Hewitt Associates (HEW), released the results of a survey of 162 mid- to large-sized U.S. companies, representing a pool of 5.7 million employees. Among companies that suspended or reduced matching retirement contributions last year, 80% plan to restore them this year.
Many companies are taking steps to ensure that retirement plans are strengthened, seeing the benefit as crucial to a productive workforce and employee retention. Only 54% of employers who took part in the survey said they were confident about their workers' ability to retire with sufficient assets, down from the 66% in 2009, according to the Hewitt survey.
According to the Pension Rights Center, a consumer organization that tracks retirement issues, at least 310 companies have suspended 401(k) matches, at least temporarily, since 2009. Among them are American Express (AXP), JPMorgan Chase (JPM), Xerox (XRX), FedEx (FDX), J. Crew Group (JCG), Hewlett-Packard (HPQ), Macy's (M), Sprint Nextel (S) and Saks (SKS)."It was obviously a tough year," says Pamela Hess, Hewitt's director of retirement research. "Companies certainly had a lot of competing priorities, but still 401(k) plans are a big focus. A lot of companies have already announced their reinstatements and a lot of others will follow suit later in the year." Hess says companies never intended for suspended matches to be permanent and that most saw them as a "short-term measure that was better than further layoffs or pay cuts."
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV