Poof Goes Your 401(k) Match

This month Kim highlights what to do when your employer freezes your 401(k) match, reviews the best fund newsletters and explains the concept of stable-value funds.

My company is no longer matching my 401(k) contributions. Can I roll my 401(k) money into an IRA? My company says I can do that only if I no longer work there. Jeff Newbolt, Moore, Okla.Sorry, but most company plans don't allow you to roll over your 401(k) into an IRA while you're still employed at the company. But there may not be a reason to switch anyway -- an employer may discontinue its match but still offer attractive investment choices. And when business picks up, your company could reinstate its match.

Several major companies, including Eastman Kodak, General Motors, Motorola and Sears, have suspended their 401(k) match over the past few months. FedEx stopped matching 401(k) contributions as of February 1. And Starbucks announced that it will no longer guarantee its employees a 401(k) match.

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Kimberly Lankford
Contributing Editor, Kiplinger's Personal Finance

As the "Ask Kim" columnist for Kiplinger's Personal Finance, Lankford receives hundreds of personal finance questions from readers every month. She is the author of Rescue Your Financial Life (McGraw-Hill, 2003), The Insurance Maze: How You Can Save Money on Insurance -- and Still Get the Coverage You Need (Kaplan, 2006), Kiplinger's Ask Kim for Money Smart Solutions (Kaplan, 2007) and The Kiplinger/BBB Personal Finance Guide for Military Families. She is frequently featured as a financial expert on television and radio, including NBC's Today Show, CNN, CNBC and National Public Radio.