10 things 401k plans won't tell you

Hidden fees, paltry choices and lousy investment returns could delay your retirement -- or prevent it entirely.

 of 12
 of 12


Dec 18, 2012 6:01PM

1980....62% of private sector employees had pensions, 2008.....7% of private sector employees had pensions.


That's interesting.


And now the Movers and Shakers believe our SS benefits are too high. I think I'm starting to get the drift of this anti-gun movement now. There must be lots of lessons coming out of the Middle East about right now.

Dec 18, 2012 8:06PM

Considering the reported frighteningly low savings rates of most Americans, I am not sure that 401K bashing articles serve their intended purpose. The 401K is far from perfect and does not replace a past generation's pension system. I question how many late stage boomers stayed at their same place of employment for 20,25,30 years and truly understood the pension system anyway. At age 40+ it's kind of too late to figure that one out.

What is (has been) really lacking in the US is training at an early age on basic personal economics and household finance. There are a lot of college educated Americans as well as s who just plain do not understand the need to SAVE MONEY! The mortgage crisis, largely is a perfect example in many cases of pure financial ignorance.

In any case, throwing a a negative spin on the 401K system creates another excuse for people NOT to save. Not healthy. People DO need to undrsatands the cost of participation and weigh them against the costsa of NOT participating.



Dec 18, 2012 8:54PM

Am I missing something on the whole "disclosing fees" discussion? Seems to me the only people who can do anything about that are the company's HR department or plan administrator- what other choice does the employee have? to NOT save for retirement? Yes, I know they could STILL open an IRA or Roth IRA OUTSIDE of work- but it seems that 80% of these "faults" transfer to ANYONE trying to save for retirement - and seems like it only adds to the inertia to NOT save- whereas the company plan is relatively turnkey. I still have yet to see the actual case study of the person who faithfully saved AT A RECOMMENDED percent throughout their work history- but "couldnt afford retirement" because of the fees or poor investment selection...

Dec 18, 2012 6:31PM
Number One: the inflation versus actual gain. and that is usually close to "zero" Since 2001 most have gained no value, unless you pay it into to the account---
Dec 19, 2012 4:29AM
This ethic has a rich history.  It makes perfect sense within that context.  In 1975, the Trilateral Commission put out an interesting report called "A Crisis of Democracy."   This report advanced the idea that too much democracy was posing a threat to the governability of societies.  In 2010, Zbigniew Brzezinski, co-founder of the Trilateral Commission, echoed the same concern again - that the entire world was becoming increasingly awakened politically, and this was creating problems in managing world affairs.  Brzezinski, of course, would go on to be Barack Obama's chief foreign policy advisor in the run up to the 2008 elections.  So the very fortuitous treatment given the nation's largest banks in 2008 - 2009, and the subsequent government refusal to divulge the recipients of trillions of taxpayer bailout funds should come as no surprise.  Nor should the Rumsfeld Pentagon's "losing" 2.3 trillion dollars back in 2003, or any of the rest of the myriad of "scandals" and corruption that run rampant today.

Establishment elites have long since considered the voice of the people as dangerous, long before the Trilateral Commission or any other round table groups of our day.   The enormously influential Ed Bernays, wrote "It was, of course, the astounding success of propaganda during the war that opened the eyes of the intelligent few in all departments of life to the possibilities of regimenting the public mind" ... and ...  "In almost every act of our daily lives, whether in the sphere of politics or business, in our social conduct or our ethical thinking, we are dominated by the relatively small number of persons ... who understand the mental processes and social patterns of the masses.  It is they who pull the wires which control the public mind."   Bernays (like his uncle Sigmund Freud) believed that the voice of the people was actually dangerous, and that propaganda and illusion were necessary to avoid chaos and maintain the status quo.  Not only must the masses be prevented from participating in the political process, but they must also be tricked into thinking that they are participating.   

Historian Howard Zinn alludes to the common preconceptions about the framers as "mythology",  referring to the US Constitution as "not simply the work of wise men trying to establish a decent and orderly society, but the work of certain groups trying to maintain their privileges, while giving just enough rights and liberties to enough of the people to ensure popular support."    Noam Chomsky states, "American elites, this goes back to the Constitutional Convention, have been very concerned over what's sometimes called an 'excess of democracy.'   That is, real participation by the public in formulating policy.  In fact the constitutional system was designed to prevent that.  [James] Madison's conception was that, what he called the 'wealth' of the nation, the responsible set of men, they're the ones who should set policy.  That's why the senate, which represented the wealthy, was given most of the power in the constitutional system—least responsive to the public and more consisting of wealth."    Alexander Hamilton himself said  "people are turbulent and changing; they seldom judge or determine right," and that it's best to give a "permanent share in the government" to the "first class."  

It harkens back to "Machiavellian Deception," and Plato's "noble lie."
Dec 18, 2012 6:30PM

Interesting article, stats.  It might be interesting to look into why such a drop off of private pensions.  That's huge.  Otherwise, this is the next liberal holy grail, and I am waiting for it to appear, and lo it has.  Bombard the public with stories about evil corporations not taking care of their people, so that government can come in and save the day.

Dec 18, 2012 10:22PM

It's almost unbelievable how the baby boomers and young American families don't realize that the american dream is fading. No one saves money and companies are not helping employees save for their future retirement. My father who retired 20 years ago had a city job and he retire with a great pension and medical benefits. In today's job market, you're be luck if you can find a company that will give you a 401k plan or even some kind of retirement benefits. I just hope the people in this great country wake-up and realize it's up to you to save for the future.

401K is a fraud.  It's MY MONEY, but I can't use it???
Dec 18, 2012 9:21PM
Dec 18, 2012 7:56PM
Americans shouldnt have a retirement fund or Social security. 401ks were put togather so big insurance companies could charge hidden fees and make big profits, social security was enacted so the government could steal money from the 2.7 trillion dollar surplus and give it to fellows like Bernie Maddoff
Dec 18, 2012 8:01PM

Middle class and moderate/low income employees who plan to retire in the next few years are going to have a lot of unpleasant surprises if they think their penison/401k will carry them throughout their retirement years. First, retirement age will eventually be bumped up to 70, the government will work against us moderate earners, and 401k's will be lost like Shina's. After all said and done, retirement for working class people will be something of the past. If you're not in the upper 1% income bracket, then 401k is a waste. If you voluntarily contribute to 401k and not financially savvy and don't understand all the new fancy lingo they use, I say pullout quickly and look for another type of saving plan where you can manage your own funds and have a basic understanding of how much interest you will be earning.  If  you keep dumping your money in this 401k blackhole; you may lose most or probably all of your money you thought you were investing.  

Dec 18, 2012 7:33PM

401K is an IRS code for a salary reduction program. It is not good at all and the employee has very little control if any, outside choosing the limited investment buckets (that is only apparent control). Also, most 401K managers do not allow you to opt out (maybe partially but there are a lot of hoops to jump) and why not be able to opt out if there are greener pastures elsewhere? Even if employers contribute, you may lose anyway because they control all the portfolios you can "choose from" and that is not good. It is like being told you can go buy a hammer at the store but it has to be only the brand the 401K manager dictates.They tend to force you to invest into related or affiliated company stock. Never mind that it is a variable vehicle and that it has no protection what so ever for your principal or that it has average tax sheltering. My opinion. 401K in this economy is a terrible vehicle to be proud of now. Tax deferral only means greater taxation in the harvest period. There are ways of doing much better but I am not here to train the competitors. I am a financial adviser.

Dec 18, 2012 5:52PM

I enrolled into a 10 yr. 401k retirement plan in the year 1997 while employed as a receptionist by a successful law firm located in Bellevue, WA.  A lot of time has passed during which I have lost track of the 401k.  My question, "is there any resources available to help me locate it?"  I have already made contact with my former employers and have not been able to get any where.  I would really appreciate any guidance in what steps I should take in locating my lost 401k retirement account.


thank you


Dec 18, 2012 6:27PM
Theivery is EVERYWHERE,....beginning with the United States Government.  Isn't it amazing that the anti-gun movement are baby killers,.....abortion IS murder,....a hanous crime against innocent children. 
Please help us to maintain a healthy and vibrant community by reporting any illegal or inappropriate behavior. If you believe a message violates theCode of Conductplease use this form to notify the moderators. They will investigate your report and take appropriate action. If necessary, they report all illegal activity to the proper authorities.
100 character limit
Are you sure you want to delete this comment?


Copyright © 2014 Microsoft. All rights reserved.

Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.


There’s a problem getting this information right now. Please try again later.
There’s a problem getting this information right now. Please try again later.
Market index data delayed by 15 minutes

[BRIEFING.COM] The stock market welcomed the new trading week with a mixed session that saw relative strength among large-cap stocks, while high-beta names underperformed. The Dow Jones Industrial Average (+0.3%) and S&P 500 (-0.1%) finished near their flat lines, while the Nasdaq Composite and Russell 2000 both lost 1.1%.

Equities began the day on a cautious note amid continued concerns regarding the strength of the global economy. Over the weekend, China reported its first decline ... More


There’s a problem getting this information right now. Please try again later.