401(k) Day 2010-Celebrating a Decade of Success

Over the last 10 years, a period some suggest is a lost decade for investors, the employer-sponsored defined contribution system has helped American workers set aside an enormous amount for their retirement. In 2000 there was approximately $2.4 trillion dollars in private employer defined contribution plans. By the end of 2009 that amount had grown to approximately $3.4 trillion. But that's not the whole story. During this period over $2 trillion was distributed from these plans, most of which was rolled over into IRAs. In 2000 the total assets in all employer-sponsored defined contribution plans and individual IRAs was approximately $5.6 trillion. At the end of what some are calling a lost decade these programs held $8.3 trillion. This is enough to buy 41,500,000 homes worth $200,000.

We hear many negative comments about 401(k) and other employer sponsored plans, however, the truth is that they are working extraordinary well – in helping millions of Americans enjoy retirement benefits today – and future generations who are investing in their company’s plans. (For more information about the success of the 401(k) investors, read the article The “Lost” Decade 2000-2009 written by Douglas Prince and Deanna Harmon in the latest issue of Defined Contribution INSIGHTS.)

On National 401(k) Day we should all tip our hats to a proven retirement program that has stood the test of time and continues to be one of the most effective ways for individuals to save for retirement.

Also as part of this year’s 401(k) Day we are releasing a free educational campaign, 401(k) Day... Taking You There, which was created to help plan sponsors reinforce with plan participants how important and effective the 401(k) system is in helping them save for retirement. PSCA 401(k) Day materials can be used alone or in conjunction with materials and campaigns already in place. All of the tools can be accessed on PSCA's special 401(k) Day website, www.401kday.org.