In a posting on this blog, dated December 14, 2010, we reported regarding an alarming trend in which private sector companies offering employees self-funded 401(k) retirement plans breach their legal duties to their employees by, for example, mismanaging the plans, offering poor or too limited investment options, or failing to monitor or offer alternatives to investments that charge excessive fees. Our research shows that this widespread trend is continuing and may well be illegally affecting your ability to retire on time, comfortably or at all.
For many employees whose private-sector employers do not offer traditional pension plans, an employer-sponsored 401(k) plan may be their only legitimate option for saving for their retirement. These plans should make saving substantial sums for retirement fairly easy for employees because the IRS permits employees to defer taxation on a percentage of their annual earnings kept in a 401(k) Plan until they have reached a minimum of 59 1/2 years of age.
The employers offering these plans, including major, reputable large corporations, and the administrators they hire to run these plans for them are regulated "fiduciaries" who have strict duties, under a federal law called "ERISA", to treat 401(k) Plan participants well and fairly. Many employers are not living up to their legal obligation with respect to the 401(k) offerings they make available to their employees.
If you believe your employer is not offering quality, sufficient, diverse investment options for your 401(k) Plan; or if your employer’s plan seems poorly managed, such as where the investments offered charges excessive fees, which cut into your investment return, your rights may have been violated and you may be entitled to share in money damages for your employer’s wrongdoing. We would welcome an opportunity to discuss your legal options and encourage you to contact us about this important issue affecting your retirement.