PBS FRONTLINE'S "CAN YOU AFFORD TO RETIRE" COULD REDUCE RETIREMENT SAVINGS

PSCA Urges Workers To Disregard The Program and Join their Employer’s 401(k)

WASHINGTON (May 23, 2006) -The Profit Sharing/401(k) Council of America (PSCA) objects to the conclusion reached by the PBS Frontline program, “Can You Afford to Retire,” which initially aired on May 16, 2006. The program’s sensationally presented conclusion – that we have reached the “end of retirement” – is not only wrong but could seriously impact retirement savings in the United States. “If people believe that they will have to work until they die, they will stop saving for retirement,” said PSCA President David Wray.

A great majority of the more than $14 trillion set aside in the United States for retirement, in addition to Social Security, was facilitated by employers using defined contribution plans like 401(k)s and defined benefit pension plans. “Both plans have pros and cons, and any effort to distinguish one as superior to the other is pointless and counterproductive,” Wray added. 

Workers also need to be assured that their retirement plans are not subject to creditors in bankruptcy, something the program puts in doubt. By law, all retirement plan assets are held in a special trust that cannot be touched by any creditor in bankruptcy. The bankruptcy court cannot eliminate or reduce a retirement benefit that is already earned, and it cannot remove assets from the retirement plan trust.

Contrary to the program’s conclusion, we have not reached the “end of retirement.” Employer-sponsored defined contribution plans like 401(k)s work for employers and their employees and will help America’s workers retire with the financial security we all desire. Employees should disregard what was presented in “Can You Afford to Retire” and, if they have not already done so, join their employer’s 401(k) plan today. 

The Profit Sharing/401(k) Council of America (PSCA), a national non-profit association of 1,200 companies and their 6 million employees, advocates increased retirement security through profit sharing, 401(k) and related defined contribution programs to federal policymakers and makes practical assistance with profit sharing and 401(k) plan design, administration, investment, compliance and communication available to its members. PSCA, established in 1947, is based on the principle that “defined contribution partnership in the workplace fits today’s reality.” PSCA's services are tailored to meet the needs of both large and small companies with members ranging in size from Fortune 100 firms to small, entrepreneurial businesses.