401k plans cutting company match

[disneysteve]

I read an article in Business Week yesterday about how companies are starting to cut out the company match in their 401ks. It isn't a lot of companies yet, but analysts expect the trend to grow as the economy continues to struggle. It doesn't really affect me since I don't have a 401k and what my wife gets from the company match isn't enough to make a difference in our retirement planning ($223.55 YTD). For many people, though, the amount is significant.

Has anyone here encountered this yet? Has your company reduced or eliminated the match?

[Daylily]

That has not occurred in my situation. However, I have a friend who works for a company in which the 401k match is never guaranteed in any given year.
At that particular company the match can be anywhere from 0 to 100% up to a max of a 5% match. I'm guessing they won't be matching this year.

[Broken Arrow]

Steve, I haven't run into that yet, but such a trend doesn't surprise me at all.

I hope my employer doesn't, because if they did, it would change everything. My employer only offers $0.28 to the dollar, but will contribute 100% of all contributions!

But considering that I don't even like my 401k company, without the employer match, I'd definitely take my money elsewhere!

[disneysteve]

Daylily, that's an interesting set up. Not knowing whether or not you will have a match each year or for what percentage would really make retirement planning more challenging.

[zetta]

I've noticed this trend for the last serveral years in the smaller high-tech companies in my area. Between DH and I, we've worked for 9 companies in the last 8 years. Of these, 5 were under 150 people in size, and none of those offered a match. 1 originally did, and then cut the match when the company started having trouble.

[marvholly]

My company has not announced this, at least yet. Would NOT surprise me if they do.

But I would be out of the plan so fast heads would spin if they dropped their 50% match up to 6%. It is the only thing that is currently saving my sanity as every investment is soo down this year. I have to think of their match as free money to mitigate my losses.