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In my work here at the Pension Rights Center, one of my responsibilities is to update the list of companies that have suspended matching 401(k) contributions. This week I’ve had to add more than 15 companies to this list. Even worse, some of these companies are suspending matching 401(k) contributions and freezing their traditional pensions, leaving more and more workers out in the cold.
We’ve already used this blog to discuss the importance of traditional pensions, the 401(k) match and how the retirement security of millions of American workers is threatened as a result of these crucial elements of retirement security being taken away.
One thing we haven’t discussed, though, is what happens next. What happens after the recession is over and these companies get back on track?
During the nation’s last recession, a number of companies suspended 401(k) matching contributions, but U.S. News & World Report found that many of these companies reinstated these contributions once they regained their financial footing. One can only hope that the companies making changes to their retirement plans will do the same thing and reverse these changes once they recover from the current economic crisis.
