Small Firms Still Setting Up 401(k) Plans

The economic turmoil has prompted smaller employers who previously hadn’t considered setting up a 401(k) plan to do so in light of the beaten down values, The Wall Street Journal reports.

But these plans are laid bare, without employer matches or automatic ramp-ups.

Even with unemployment running at 7%, small businesses realize they need to be proactive about retaining employees, said Rick Meigs, president of 401khelpenter.com.

“Employees want to work for firms that help them meet other life goals like saving for retirement,” Meigs said.

A recent survey of 3,000 households by the Investment Company Institute found that 43% of the more than half of those households with a 401(k) plan said they would not be saving for retirement at all if it were not for their workplace retirement plan.