scrabbler1
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
- Joined
- Nov 20, 2009
- Messages
- 6,699
When I started working in 1985, we had a primitive 401k plan consisting of 2 funds - a Stable Value fund and an S&P500 fund. We could choose only increments of 25% when allocating our contributions. The company matched 50% of our first 6% of pay. We also had a pension plan.
A few years later, the plan moved to a new administrator and we had more fund options and more choices about how to allocate our contributions. The company also increased its match from 50% to 75%. Pretty good stuff.
A few years after that, the company introduced its ESOP plan. So for a few years in the late 1990s, we had a growing ESOP, a good 401(k), and a pension plan.
But then the glory days ended in the 2000s. First, the pension got frozen for anyone who failed to meet the requirements to get grandfathered in. This included a certain combination of experience and age which I didn't meet (the age part, I was only 38 at the time). New hires were no longer brought into the pension plan. Instead, new hires and non-grandfathered employees were moved into a Cash Balance plan (that's a hybrid of a DB and DC plan). Then, the annual company stock allocation into our ESOP account got reduced when they diverted a lot of it (about 40%) for the 401(k) match.
But a few years later, new hires were no longer added to the Cash Balance plan. Instead, they had a profit sharing plan, separate from the ESOP.
The ESOP changed after I left the company in 2008 when the company went public so anyone could buy and sell shares at any time. Before that, employees had to keep most of their allocated shares as long as they remained employed. When an employee left, they could cash out their ESOP (like I did) or roll it over into an IRA. I did a rollover IRA from the pretax part of the 401k and cashed out the after-tax contributions, a fairly small amount.
I'd say the 401(k) was pretty good for me.
A few years later, the plan moved to a new administrator and we had more fund options and more choices about how to allocate our contributions. The company also increased its match from 50% to 75%. Pretty good stuff.
A few years after that, the company introduced its ESOP plan. So for a few years in the late 1990s, we had a growing ESOP, a good 401(k), and a pension plan.
But then the glory days ended in the 2000s. First, the pension got frozen for anyone who failed to meet the requirements to get grandfathered in. This included a certain combination of experience and age which I didn't meet (the age part, I was only 38 at the time). New hires were no longer brought into the pension plan. Instead, new hires and non-grandfathered employees were moved into a Cash Balance plan (that's a hybrid of a DB and DC plan). Then, the annual company stock allocation into our ESOP account got reduced when they diverted a lot of it (about 40%) for the 401(k) match.
But a few years later, new hires were no longer added to the Cash Balance plan. Instead, they had a profit sharing plan, separate from the ESOP.
The ESOP changed after I left the company in 2008 when the company went public so anyone could buy and sell shares at any time. Before that, employees had to keep most of their allocated shares as long as they remained employed. When an employee left, they could cash out their ESOP (like I did) or roll it over into an IRA. I did a rollover IRA from the pretax part of the 401k and cashed out the after-tax contributions, a fairly small amount.
I'd say the 401(k) was pretty good for me.