More Workers Say No to 401(k) Plans USA Today Online (11/13/02) ; Dugas, Christine
According to a recent Plansponsor.com survey, participation in 401(k) plans fell 2.5 percent to 75 percent in the past year, and larger plans experienced a greater decline, nearly 6 points between 2001 and 2002 to 73.7 percent. Savings rates among employees also fell from 8.6 percent in 1999 to 7 percent, which has worried many retirement experts and employers. Experts agree that the bear market, layoffs, increasing health care costs, and corporate scandals have caused many workers to back away from employer-sponsored retirement plans. Moreover, workers are using their paychecks to make ends meet, and younger workers are unwilling to save for retirement when they can barely afford their current expenses. However, other employees are withdrawing their investments from 401(k)s in favor of other investment opportunities, claiming that they earn more on their own.