Archive

Providing Independent Advice Could Fortify 401(k) System, Congressman Says

By Staff Report

Apr. 9, 2009

A key lawmaker involved in setting retirement policy is angling to strengthen the 401(k) system by providing individual investors with increased access to independent investment advice.


Rep. Robert Andrews, D-New Jersey, speaking in New York on Tuesday, April 7, at a retirement seminar sponsored by Barclays Global Investors of San Francisco, said that despite more than $2 trillion in losses over the past year, the 401(k) system is not broken. It just needs some minor, and rather immediate, adjustments to empower individual investors, said Andrews, chairman of the House Subcommittee on Health, Employment Labor and Pensions.


He plans to push an agenda through Congress that will strengthen the defined-contribution system by encouraging employers to hire more independent investment advisors for their 401(k) participants.


In a 401(k) system, participants essentially are asked to act as their own “pension board of trustees” and make key investment decisions almost entirely on their own, Andrews said.


“Yet most of us are woefully equipped to do this,” he said.


If more companies provided employees with access to independent investment advice, 401(k) participants would make better fundamental decisions about managing their retirement savings accounts and ultimately have more confidence in the 401(k) system, Andrews said.


“I don’t think we should confuse a lack of confidence in the economy with a lack of confidence in the [401(k)] system,” he said, contradicting the notion that the 401(k) system needs an overhaul to prevent workers from sustaining massive losses in their retirement accounts.


Filed by Mark Bruno of Investment News, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.


Workforce Management’s online news feed is now available via Twitter


About Workforce.com

blog workforce

We build robust scheduling & attendance software for businesses with 500+ frontline workers. With custom BI reporting and demand-driven scheduling, we help our customers reduce labor spend and increase profitability across their business. It's as simple as that.

Book a call
See the software

Related Articles

workforce blog

Employee Engagement

12 practical employee appreciation ideas for better engagement and retention

Summary Showing appreciation to your employees improves engagement and retention. There are 12 practica...

employee appreciation, engagement, HR, raccoons

workforce blog

Compliance

California fast food workers bill: why it’s more than meets the eye and how to prepare

Summary: California signs bill establishing a “fast food council” that has the power to raise the indus...

workforce blog

Employee Engagement

7 statistics on employee turnover in 2022 every HR manager should be aware of

Summary July 2022 saw 5.9 million total separations – More Replacing a full-time employee can cost up t...

employee retention, employee turnover