Investors Lose Confidence in 401(k) Plans

Many investors are questioning the wisdom of investing in 401(k), 403(b) and 457 plans, according to a survey.

Thirty percent have either stopped saving for retirement or cut back on their contributions, and 28% haven't even started saving for retirement in the first place, the Allianz Life Insurance Co. survey found.

Twenty-seven percent said the safest place to put their money is under their mattress. A quarter of the investors said that they had either reduced or stopped saving for their children's college education, and 44% haven't started at all.

Forty-seven percent of those not yet retired say the economy has had an impact on their retirement savings actions. Among those still saving, 20% said they have had to cut back on other areas in order to continue to afford to save.

"Given the gut-wrenching events and market volatility of late summer, consumers are questioning traditional retirement savings vehicles and changing their savings habits," said Katie Libbe, vice president of consumer insights at Allianz. "The toll taken by recent economic volatility has yet to be fully calculated, but one thing is certain. It has directly impacted how people are approaching saving for retirement and college."

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