A press release I received from Hewitt this morning seemed pretty ho-hum at first glance: the consulting firm finds that last year 46% of job changers/laid-off workers cashed out their 401(k)s.* I thought: Well, of course they did! There’s a RECESSION. Trading compound interest for tax penalties doesn’t matter much when you’re trying to keep a roof over your head. Duh.

However, as I read on, I saw that the statistic has remained virtually unchanged since 2005. Hmmm. I didn’t have as easy an explanation for that.

According to Hewitt, “increased efforts to caution Americans about the negative financial consequences of cashing out their 401(k) plans have had little impact in changing their behavior over the past few years.”

No offense, but what are these “increased efforts” they speak of? I’ve never heard anyone tell me they were thisclose to cashing out their 401(k), but that their employer/retirement plan rep/tooth fairy advised them against it. But maybe I’m alone. Let me know, pros. Have you and your vendor/consultant partners stepped up efforts to keep workers from cashing out? If so, what are you going to do differently, since it clearly isn’t working so well?

For their part, Hewitt recommends legislation that would keep workers from cashing out until age 59 ½, better education about the negative effects of taking a cash distribution, offering more institutional funds and simplifying the rollover process.

(* Of the rest, 25% rolled over the funds into an IRA or new employer plan and 29% kept their savings in their prior employer’s plan. Among other findings, younger workers and participants with lower balances were most likely to cash out.)

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