Do 401(k)'s Give Workers an Illusion of Wealth?
New York Times (05/26/02) ; Uchitelle, Louis

New York University economist Edward N. Wolff says 401(k)s give investors a false sense of financial security. According to Wolff, 401(k)s deceive people into believing they have more money than they really do. The tendency of most people is to look at the balances in their 401(k) accounts without taking into account that company-paid pensions--which are currently on the decline--would have made them wealthier than setting money aside for retirement, he says.

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