401(K)

Gov. Mary Fallin has signed into law a bill that ends pensions for new state employees under the Oklahoma Public Employees Retirement System, moving new hires into 401(k)-styled plans that don't offer a guaranteed benefit. The only question now is what's next when it comes to cutting state pension plans in Oklahoma?

A new study finds that the typical 401(k) fees - adding up to a modest-sounding 1 percent a year - would erase $70,000 from an average worker's account over a four-decade career compared with lower-cost options. To compensate for the higher fees, someone would have to work an extra three years before retiring.

Three U.S. Senators recently introduced a bill to eliminate defined benefit plans for federal fire fighters and other government employees. Contrary to the bill’s name — the Public-Private Employee Retirement Parity Act — the legislation would clearly do nothing to create parity among public and private retirement systems, forcing federal fire fighters to rely solely on an expensive and unpredictable 401(K)-style system.