Small businesses considering eliminating 401(k) match

While the majority of small businesses do not think the economy will affect their ability to offer a 401(k) retirement plan, 44% said they may have to reduce or stop matching employee contributions, according to a survey released today by Nationwide Financial Services Inc. of Columbus, Ohio.

A small company was defined as having 5 to 250 employees. To qualify for the survey, respondents had to have offered a 401(k) retirement plan for at least one year and have between $500,000 and $10 million in retirement plan assets.

Some 31% of respondents ranked providing employees with investment education as their top concern; 29% selected fiduciary and legal responsibilities as the top concern, and 21% chose the selection and monitoring of retirement plan investment options.

A full 74% said that they valued an investment adviser’s ability to help them meet the legal responsibilities associated with offering a retirement plan.

The survey of 401 respondents was conducted by telephone interviews between December and March.