So you think your 401(k) money is safe
Los Angeles Times, December 10th, 2006
Jim Elliott, 55, spends his days clambering onto the tops of houses,
taking measurements for the wooden trusses his company sells to support
roofs through long, snowy winters.
Not long ago, Elliott thought his ladder-climbing days would soon be
over. With a few more years of work, his 401(k) account would be large
enough to let him retire at 60 and spend his days with his three
grandchildren.
Then Elliott learned that his former employer had looted the company's
401(k) plan. The $230,000 he had saved over three decades was gone.
A government-appointed trustee is trying to recover the money, but
workers have been told they can expect to get back perhaps half what
they lost.
"I'm going to be up measuring roofs when I'm 75 years old," said
Elliott, a husky man with steel-gray hair. "I didn't do a lot of things
over the years because I was trying to save for retirement. Now I see I
was paying for somebody else's vacations."
If Elliott had a traditional pension, his retirement checks would be
guaranteed under a federally backed insurance plan. But no comparable
protection exists for 401(k)s, even though they are rapidly replacing
pensions as the financial backbone of retirement for most Americans.
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