401Ks are a disaster: Column

[question everything]

69. The reality is that many corporations that promised pensions

later went out of business, as did their obligations. I am thinking of steel and airlines. I think that they declared bankruptcy and the way to get out of it, once the executives got their millions, was to ditch or "modify" the obligations.

So 401(K) should have replaced them. Most employees, however, did not put this as their first priority and employers matched very little and suspended matching during the great recession.

I think that employers should have been mandated to match 10%. What difference would it make? They would still deduct it.

Several years ago changes were made so that each employee was automatically enrolled, had to make an effort to opt out.

I don't know whether the ones who chose not to really were facing hardship. It was just easy to drop it.

I know that for us, when offered, we contributed the maximum allowed. This was our first priorities. Paying credit cards could wait..