Only 1 week notice they're cutting 401k match in half

[Anonymous]

Company just dropped this on us. We're a smaller company with a management team that is always quite open with the staff about issues. They really pulse the employees about satisfaction and changes they'd like to see. They brief the entire company each year about revenue.

And then they send out an email notifying us that come 1 Feb, that from now on, they will only match 50% of our 401k contributions (up to 5%). I'm actually stunned at this sudden change.

[Anonymous]

Would you rather they lay off people? I think it's a bit weird that you're fussing that they aren't able to give away as much money anymore. Perhaps be glad that they still match in any capacity?

[Anonymous]

I work in the pension field. Most plans I work with don't offer a match at all. Many that did offer it quickly latched on to some legislation that allowed them to drop it a few years ago, mid year. You're lucky that your company kept it as long as they did, and that they'll continue to offer something.

I'm working right now, on ADP tests. This helps me advise the client whether they need to retain the employer contributions or if there are cheaper ways to increase their own deferral amounts. That's a part I hate about my job...screwing over the peons to benefit the owners as much as possible.

I'm sorry, though, that this happened to you.

[Anonymous]

Time to look for a new job.

[Anonymous]

With no notice, cut match completely! No warning. This reflects the times!

[Anonymous]

5% is still a really generous match and probably well above norms. I have only worked at companies with 3 and 4% matches and the 4% one cut it back a couple of years ago. I think there is also research that shows that younger employees don't value 401K matches as much as comp so maybe they've looked at that angle too.

But if you think your comp/benefits package can be increased elsewhere then certainly look for a new job.

[Anonymous]

I agree the lack of notice sucks. The action they took, however, is pretty common.

[Anonymous]

Something has to offset the cost of Obamacare. The 47 percent is increasing the sucking action

[Anonymous]

obamacare

[Anonymous]

Took less than 30 minutes to pin this on Obamacare - may be a DCUM record. OP, sorry about the change. Does seem counter to company culture that they did not explain it in a meeting as opposed to using email. A few years back our company toyed with dropping health insurance over the match. Fortunately, a group of single employees as well as married employees on their spouses' plan united in opposition. The match was cut back but health insurance kept for those with no other options.

Appreciate comments from PP who said companies look at every opportunity to generate the most profits for the wealthiest. And agree with another PP that I would rather take a hit on my 401(k) rather than having an employee lose a job.

[Anonymous]

Anonymous wrote:Time to look for a new job.

Yes, at which point you will discover that most places don't have a match at all and that you should consider yourself lucky, even if disappointed.

[Anonymous]

My small firm sold itelsef to a big firm last year. They cut our match 100% with no notice. Just announced it. Pretty lame.

[Anonymous]

My company dropped the match altogether a few years ago. I think it came back last year. I'm guessing we will not have any match this year, however. In all the paperwork about the 401k, there was always language that the match was at the discretion of the company. I hope you weren't planning on it as part of your retirement planning. I always see it as gravy, though obviously i'm happier when I get it!

[Anonymous]

Thanks POTUS

[Anonymous]

My employer matches us two for one up to 5%, which is outrageously generous. I live in fear that that the same thing will happen to me. Sorry OP. That sucks.