KIPLINGER RECOMMENDS

Home > Finance

COMMENT

BUZZ UP

DIGG

CHECK OUT:

EXECUTIVE POLL

Bernard Madoff, convicted of running an $65 billion Ponzi scheme, was sentenced to 150 years in jail. What’s your take on his punishment?

Compare Price Quotes 100+ Services

OUR PREMIUM CONTENT

The Kiplinger Tax Letter
The Kiplinger Agriculture Letter
The Kiplinger California Letter
Kiplinger's Biofuels Market Alert
Kiplinger's Retirement Report

SUBSCRIBER HELP

CURRENT LETTER

By Knight Kiplinger

The Kiplinger Washington Editors

July 2, 2009

By year-end or so, Congress will give the nod to a major rewriting of the nation's financial regulatory system. This week’s Kiplinger Letter explores whether the package will do more harm than good and what lawmakers are likely to include.

ALSO IN THIS ISSUE: The Economy, Business Costs, Taxes, Supreme Court, Energy, Workplace Regulations, Climate Change, Health Care Legislation and Foreign Policy

PREVIOUS ISSUES

CORRECTIONS

TRY THE LETTER:
Subscribe | See Sample

YOUR FEEDBACK

SUBSCRIBERLOG: Got a topic you'd like to discuss? Or a problem or question? Please join our exclusive forum for Letter subscribers only.

ASK US: A Kiplinger Letter editor will promptly answer subscriber questions.

OPEN FORUM: Share your insights and analysis with other visitors.

I just attended a franchise seminar. The speaker represents a few hundred franchises that (he says) are hand picked. He has the prospect (aka victim?) answer some questions about themselves then he makes recomendations - based on your personality, capital situation, etc.. If you pick a franchise, then he does some due dilligence for you. If you both decide it's a good idea, he helps you get started. He says he offers this service free of charge, which means he gets a commission if he's able to sell you a franchise. Has anyone done this? Successfully? Unsuccessfully?

-- fender

More Companies Push Employees to Invest in Retirement

Employers are doing more to help workers get more out of retirement investment accounts by cutting fund costs and pushing employees to nudge up contributions.

Worth Reading: The Quick Take from Kiplinger

June 2008

Hewitt Associates

Hewitt Associates is a global provider of human resources outsourcing and consulting services. The company consults with more than 2,300 organizations and administers human resources, health care, payroll, and retirement programs on behalf of more than 340 companies to millions of employees and retirees worldwide. Located in 35 countries, Hewitt employs approximately 24,000 associates.

A spate of recent laws and federal rules are spurring companies to take a variety of steps to reduce risk and increase the financial rewards of their retirement programs. A survey of 190 mid- to large-size companies by the consulting firm Hewitt shows that a growing number of firms offering 401(k) plans are automatically enrolling employees in the plan, automatically increasing worker contributions and sometimes even automatically rebalancing their accounts so they are not overexposed to any particular type of investment. Employers are also searching out lower-cost funds to reduce fees and offering more investment advice to workers.

A variety of factors "are putting employers under more pressure than ever to effectively manage two sides of the retirement equation -- minimizing risks and unnecessary costs, while optimizing the benefit that employees will get from their retirement programs," says Alison Borland, the leader of Hewitt's defined contribution consulting practice.

The survey found many companies moving beyond automatic enrollment of employees because, while helpful in terms of increasing workers' contributions, it does not necessarily get them actively involved in handling their own accounts. "This is why we're continuing to see a steady increase in the number of companies not only adding automatic enrollment to their 401(k) plans, but also defaulting workers into diversified investment options, choosing higher default contribution rates, and coupling automatic enrollment with contribution escalation features," Pamela Hess, director of retirement research at Hewitt, says.

Hewitt also found a surprise related to a vanishing breed: traditional pensions. The long shift by many employers away from defined contribution plans and toward vehicles such as 401(k) plans is slowing this year. Almost three quarters of companies that offer a pension plan told Hewitt they will make no changes to those plans in 2008, compared with just 41% last year.

READER COMMENTS