Dear employer, PLEASE don't cut our 401(k) matchings!
You KNOW how much i love my 401(k), would you really do this to me? We've fallen in love, and could not bear such a tragedy :( I promise to behave, really. Whatever you wish, i shall do - just name it!
What? You want me to do what? Stop blogging @ work? errr......
Haha, yes, i am all hocked up on coffee and cold medication ;) Seriously though, it's like my brain work a lot better when i'm in a total state of loopiness.....the words just flow out like butter! warm butter, that is. it's the only up-side to possibly getting sick...but i digress..
So WHY, exactly, would companies start getting rid of their 401(k) matchings? The Economy - plain and simple. Here's a clip from a recent CNNMoney article i just read:
I know not everyone cares, or even particpates, in their retirement funds (naughty, naughty!) but when you're getting matched 100% of 100% of your contributions, it's a big deal! That $15,000 i threw in so far this year has rewarded me handsomely with an extra FREE $15,000!It's seriously insane.
All that being said, what'll happen will happen no matter what my feelings are on it. After all, if it's between firing a couple of us OR losing our generous benefits, then by all means slash away! The money is nice - okay, HOT DIGGITY nice - but my employment is better. I like it here and i don't wanna go anywhere :(
What? You want me to do what? Stop blogging @ work? errr......
Haha, yes, i am all hocked up on coffee and cold medication ;) Seriously though, it's like my brain work a lot better when i'm in a total state of loopiness.....the words just flow out like butter! warm butter, that is. it's the only up-side to possibly getting sick...but i digress..
So WHY, exactly, would companies start getting rid of their 401(k) matchings? The Economy - plain and simple. Here's a clip from a recent CNNMoney article i just read:
"[In a slowing economy] it's reasonable to assume that some employers will reduce or even eliminate the 401(k) match," said Frank Boucher, of Boucher Financial Planning Services in Reston, Va.It's all about weathering the storms i suppose. And I have a sinking feeling our company could be next...i don't have anything to back that up, but i'm pretty sure changes are coming in '09, and that seems to be a favorite to cut.
Any well-drafted 401(k) plan allows the employer discretion to change the company's matching policy at any time, Boucher said.
I know not everyone cares, or even particpates, in their retirement funds (naughty, naughty!) but when you're getting matched 100% of 100% of your contributions, it's a big deal! That $15,000 i threw in so far this year has rewarded me handsomely with an extra FREE $15,000!It's seriously insane.
All that being said, what'll happen will happen no matter what my feelings are on it. After all, if it's between firing a couple of us OR losing our generous benefits, then by all means slash away! The money is nice - okay, HOT DIGGITY nice - but my employment is better. I like it here and i don't wanna go anywhere :(
Labels: 401k, crazy economy, work
posted by J. Money at
11:02 AM
10 Comments:
A matching plan can be a huge part of an employee's compensation, so having it cut is the same as a significant pay cut. I can't imagine how furious I'd be if that were to happen.
Wow, I wish we all had that kind of matching on 401k. Right now I am not getting anything, until I have been here long enough. Then I will get a max of 3% on 6%, which seems pretty standard.
But even having that part cut would be really annoying since it was basically part of the income you were expecting when you took the job.
Good luck with all that, I think my 401k match, being so meager, is safe at our company.
yeah, it'll def. be noticed if it goes bye bye...doing my best to stay positive though! luckily i can just blog about it and get it out of my system ;)
Philip - yup, i think 3% on 6% is standard for sure - at least at my previous jobs...but even that's better than zero!
Wow that is insane J. Money! I thought ours was good here, we get matched up to 4% and we also get another 10% just for showing up! But 100% for 100% ? Wowie, for your sake I hope they dont cut it either.
I heard about that this morning on NPR. I could see our company doing something like that too, although I don't know, we've weathered tough times before, so we'll see.
Or they could just make it vest... meaning they give it to you in 2 or 3 years, like they do at my job (you forfeit the match if you leave. If you stay for 3 years, you get like $4000 for every 15,000 you put in each year).
Love the blog, keep up the posts!
great attitude, you love money but your employment better... just keep thinking that way --- I will keep hoping for you that your match doesn't dissapear!
@James - Yeah, i can only hope they'd start doing the vesting stuff but i doubt it....my boss is an all or nothing kinda guy...everythign we have is 100% fully vested right now, so as you can imagine it would suck losing all :( And glad you like the blog - thanks for reading!
@jpkittie - thanks :) it's hard some days, but i keep reminding myself that i actually enjoy working here, so it helps keep the spirits high!
100% on 100%? That's insane -- and, of course, wonderful. My employer only matches the first $1,000, and fiance's place matches 50% on the first 6%. Good thing I looked at his contributions -- he wasn't even putting in the 6%!
oh wow, good catch! i find that it's so common though w/ all my friends - they either a) don't know how much their matching is and all, or b) they pick one % and then leave it there forever and forget about it.
as long as people contribute i'm happy about it, but i just wish people would at least "check-in" on it ever year, if not twice a year.
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