Did you know the very man who created the 401(k), Ted Benna, has publicly stated that it has become a MONSTER that he wishes could be “blown up”?
Ted Benna was among the first to establish a 401(k) plan, creating it at his own employer, the Johnson Companies (today doing business as Johnson Kendall & Johnson). At the time, employees could contribute 25% of their salary, up to $30,000 per year, to their employer’s 401(k) plan
Why? Here are the hard-hitting facts:
- Complexity and Rising Fees: The 401(k) plans of today are loaded with complexities and mounting fees that erode your hard-earned savings.
- Investment Risks: The burden of investment risk has been offloaded from your employer onto YOU.
- Inadequate Saving: The harsh truth is many of us aren’t saving nearly enough for a secure retirement.
- Unequal Benefits: The tax benefits of the 401(k) disproportionately favor the wealthy. Is that fair?
- Limited Financial Literacy: Not everyone is a Wall Street wizard. Many participants make suboptimal investment choices due to a lack of guidance.
Isn’t it time we PIVOT and demand MORE from our retirement plans?