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Originally Posted by disneysteve
That's a disgrace! Your company should be chastized for even having a 1% fund in today's rate environment. Even if you don't personally invest in that fund, I think you should contact the plan administrator and complain about that. There's no excuse for not paying a bare minimum of 4%, and as we all know, 5% and more is readily available.
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I actually have asked our HR manager why it's set up that way and she told me that our company doesn't want to be held liable for putting people into the market if the market goes down. It really does annoy me, since we have the option of those really nifty targeted retirement funds and it wouldn't be hard to set up putting someone into the appropriate fund for their age group (i.e. put a 55-year-old into the 2015 fund, put a 25-year-old into the 2045 fund, etc.), but she said the company has no intention of changing the policy.
For the record, I did just check the administrator's site and it's guaranteed at least 1%, but is on target for a 3% return for this year. So it's not atually as bad as I made it sound, but it's still not enough growth to keep up with inflation. Hell, it's not enough to keep up with my savings account.