401(k) Bonanzas Wonft Promote a Rash of Early Retirements

Abstract

(Response) In a rebuttal to Joel Rich, the author argues that increased use of 401(k) plans has been good for both employers and employees. Citing a recent KPMG Peat Marwick survey, the author points out that the vast majority of 401 (k) plan participants still have low levels of savings. Therefore, employers are unlikely to lose many employees to early retirement as a result of inflated 401(k) accounts. Nevertheless, the author concludes, employers may find their retirement plans becoming less effective as a retention tool; they may have to find other ways to influence employees' job choices.