Investors in 401(k) plans have more investment options and receive more education about investing for their retirements than they did three years ago, according to the 1999 "Trends and Experience in 401(k) Plans" survey by Hewitt Associates, a management consulting company in Lincolnshire, Ill.

Nearly twice as many employer-sponsored plans, 42 percent, offer 10 or more investment options today than they did in 1997, when 23 percent of 401(k) plans included 10 or more investment options, according to the Hewitt survey of 400 plan sponsors nationwide.

Today, an overwhelming majority of plans, 86 percent, also provide investment education to employees. This is up markedly from 1997, when 59 percent of the plans Hewitt surveyed said they offered education to employees.

Of this 86 percent that provides investment education, 61 percent said they provide ongoing education in the form of: information available on the Internet, seminars and workshops, written materials, video conferences or videotapes, online interactive software, a telephone help line, and one-on-one counseling or financial planning, according to Hewitt.

However, only 43 percent of the plan sponsors surveyed said they took the time to introduce employees to their 401(k) plans in an enrollment meeting, according to the survey.

The survey also found that sixty-five percent of the employers surveyed said they offered a defined benefit pension plan as well as 401(k) plans. Also, two-thirds of surveyed employers reported that employees contribute between five and eight percent of their pay to their 401(k) plans, even though the common maximum contribution rate is 15 percent.

In the three years since Hewitt last conducted a defined contribution survey, 401(k) plans have improved because employers are increasingly realizing that they bear some responsibility to help the public save for their retirement, said Scott Peterson, defined contribution practice leader at Hewitt.

"Clearly, employers recognize that a well-designed plan is critical for employees to prepare for a secure retirement," Peterson said. "By offering more investment options, employers are enabling employees to diversify, which is essential for retirement investments."

Roughly one-fifth of employers surveyed match employees' contributions dollar for dollar, up significantly from only five percent making 100 percent matches in 1997, according to the survey. Ninety-two percent of all employers make some match.

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