Professional Financial Services


Key shortcomings of today's 401(k) plans:

  • Retirement income is not protected from adverse markets.
  • Participants can exhaust their assets during retirement. 
  • Participants are not saving enough.
  • Too many individuals still do not participate in the 401K plan.
  • Potential for increased fiduciary exposure.

Although the market collapse has increased the urgency of efforts to reform 401(k) plans, it is important to note that the shortcomings of these plans existed long before the the past financial crisis.  Retirement income is not protected from adverse market conditions, assets can be exhausted during retirement, most participants are not saving enough, there is still the problem of lack of participation, and the potential for increased fiduciary exposure exists.

However, these drawbacks do not mean that 401(k) plans cannot help employees achieve a secure retirement.  Many employees have embraced these plans and use them as their primary retirement savings vehicle.  What these plans need is the incorporation of the following three elements:

  1. Built in risk protection -  to protect participants' future retirement income against adverse markets in the years just before retirement, and to ensure that participants cannot exhaust their source of retirement income during retirement.
  2. Autopilot retirement planning -  that provides participants with an automated and pre-defined path from their first day of employment through their retirement that maximizes their chances of enjoying a secure retirement.
  3. Streamlined plan operations -  that automate and reduce the cost of plan administration, making 401K plans more affordable to small firms.

While almost all investors were affected by the market collapse in 2008, Baby Boomers approaching or in their first years of retirement were among the most seriously impacted.  Near retirees, especially those without access to other sources of retirement income such as a defined benefit (DB) plan, now find themselves having to delay retirement.  Legislators, plan sponsors, and plan participants are questioning the long term viability of their 401(k) plans and whether 401(k) plans are equipped to serve as their primary retirement savings vehicle.    

Securities offered through The O.N. Equity Sales Company (ONESCO), Member FINRA/SIPC, One Financial Way, Cincinnati, OH 45242 (513) 794-6794
Investment Advisory Services offered through O.N. Investment Management Company (ONIMCO)
Boccaccio & Associates is independent of ONESCO and ONIMCO.  
Licensed to offer securities, insurance and annuity products in Connecticut, Massachusetts, Vermont, New York, and Florida.