401(k) Scramble; Is (k) for (k)aput?
Treasury & Risk Management (09/02) Vol. 12, No. 8 p.35; Aschkenasy, Janet

Companies are not paying enough attention to how their 401(k) plans are being managed and are increasing their risk of being sued by disgruntled plan participants, according to Ted Benna--creator of the first 401(k) plan. Many of the baby boomer generation, who once counted on 401(k) funds for comfortable retirement, are now being forced to delay retirement or change their standards of living because of diminishing funds. Cases of 401(k)-related litigation have increased, and Congress is considering taking action to protect plan participants by imposing stricter provisions and requirements for fund managers and companies. To prepare, companies should re-examine their 401(k) plans and look at the levels of company stock invested in participants' plans. Companies need to consider providers' management fees, the diversification of participants' stock, and educating employees on their need to invest and how to make safer investments.

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