Lesson 9 Generic Problems with Pension Plans
What Is Wrong with Self-Funded, Self-Directed Plans?
When it was first introduced, the 401(k) plan was not intended to be a replacement for the traditional pension—it was designed to supplement the traditional plan. Today, the 401(k) is fast replacing the traditional plan.
From the employee’s perspective, it offers far less in guaranteed benefits, and shifts much of the burden for providing a decent retirement to the employee. Let’s take a look at what we have lost, and how the 401(k) compares.
As the nation’s primary pension system, the 401(k) leaves a lot to be desired. Far too many employees underutilize the system, fail to participate, make inappropriate investment choices, borrow too much of ...
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