Shrinking 401(k) accounts may soon seem like a bit of a luxury as more and more companies eliminate matching contributions to the retirement accounts, reports BusinessWeek. Some 2% of firms in a recent survey said they had already cut out the match, and another 4% said they’ll drop it within the next year as the economy worsens.
The cost-cutting move is a double whammy for employees. Not only will they lose the match, but workers generally contribute more to their 401(k) plans when they have an employer match. But the alternative is worse: layoffs. Forced to choose, says one benefits expert, employees "would rather have their jobs and a reduced match."
(Read more financial crisis stories.)