If they meant to keep good employees with the change to the 401K plan, I think that plan will backfire. This could even encourage those who were thinking of staying here for a while to leave as soon as possible. Have you started sending applications since the change was announced?
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@2srp,
What other companies are doin this??? The criminal corporation Chainsaw Charlie went to after he pillaged BK? Very few companies don't match paycheck to paycheck.
I think that you have it exactly right. We 401K participants are lending our money to the bank with an interest free loan during an era of rising interest rates. Worse, it never can be paid off as the same thing will happen next year, and the year after, so there will always be a no interest outstanding loan to the bank.
We lose dollar cost averaging and thus bear all of the investment risk. I have trouble believing that this can even be legal.
So don’t call me slow on the pickup but BNYM’s plan is to hold our 401k money for a year, take advantage of the high interest rates and profit from it and then distribute annually to eligible employees while keeping the interest for themselves…those that don’t finish the year, it’s free money for the firm, right? Meanwhile, the employee loses out on profiting from the ups and downs of the market in the meantime. If the market is low all year and spikes around the time the distributions are made, the employee buys shares at the premium price and loses out on the gains they could have made through the year. And if the market tanks immediately after the distribution, then they just bought those shares at an overvalued price and they lose. Is that about the sum of it?
At this point anybody with solid skills and a work ethic has left, is actively in a job hunt or likes it here The rest are likely hoping for a layoff.
Don’t think BNYM is the only company handling 401k contributions this way, they are catching up with others in the industry. It is about making the balance sheet look better.
If you didn't plan on leaving I doubt this 401K change will be the one action to make you apply elsewhere, but this could easily be the final nail in the coffin for many who have dealt with a lot of disappointments of this place. The other thread about recently lost benefits over the past few years shows how things have gotten bad. Even those who have left but had second thoughts about leaving may find they made the right decision after all. Those who have been here 25 years are probably waiting for that package.
It’s objectively worse than what it was. The 10 shares don’t make up for it given they have their own fine print. I doubt this alone will make people leave but I’m sure it’s the final nail in the coffin for many.