Cliffp's post got me thinking. Why are one's employer and 401k so closely related. Why can't an individual just open a "401k" at Vanguard and contribute to it through the year. The tax deduction could be made directly on the 1040 just like an Traditional IRA. The only problem I see with this system is matching, but couldn't employees just submit documentation once a year showing their contributions and receive a check for their matching? Could a system like this work? It seems that it would eliminate a lot of bad plans.