ons that the 401(K) programs, in which employee contributions to their retirement savings are matched by the employer, are so popular. Participation in 401(K) plans is increasing.
Another reason for their popularity is that a good 401(K) offers a wide range of investment options. Being able to select options and control their own investments appeals to most baby boomers. Nationwide, employers are contributing less to retirement programs. This responsibility shift requires more work for the employee. Faced with the many retirement and medical options, workers must be much better informed. They are making the decisions.
On their side, employers have at least a fiduciary obligation to provide some financial information to employees explaining retirement and investment plan structures and available options. However, companies must take every precaution not to advise employees on specific investments, or they can open themselves to liabilities and possible legal actions. As a result, most company programs focus on investment fundamentals in an attempt to assist employees in understanding the basics of asset allocations and rates of return.
Historically, little if any, profit sharing with employees was available during the time the parents of the baby boomers were working, except for a few top executives. Today, more and more workers each year share in the profits of the company which employs them. Most average American workers own more and more of the companies in which they work (Boyett & Conn, 1991, p. 117).
Benefit choices are available in areas other than retirement. Both large and small firms are following a growing trend to offer employees the option of choosing their benefit package components. Some employers offer a cafeteria-style menu of benefits. Baby boomers can select how they want to allocate the benefit money that is available to them to spend on health care, disability insurance, a...