Cover image for The great 401(k) hoax : why your family's financial security is at risk, and what you can do about it
The great 401(k) hoax : why your family's financial security is at risk, and what you can do about it
Wolman, William.
Personal Author:
Publication Information:
Cambridge, MA : Perseus Pub., [2002]

Physical Description:
x, 246 pages : illustrations ; 24 cm
Added Author:
Format :


Call Number
Material Type
Home Location
Item Holds
HD7105.45.U6 W64 2002 Adult Non-Fiction Non-Fiction Area

On Order



According to business and finance journalists Bill Wolman and Anne Colamosca, the American public has been hoodwinked: 401(k)s, the most popular mechanism for retirement investing, were established to satisfy corporate, not individual, interests. They are replacing defined benefit-pension plans at an alarming rate and are vulnerable to the vicissitudes of the market, which--if history serves as our guide--is destined for at least a decade of lackluster performance. Drawing on primary historical and contemporary data, Wolman and Colamosca build a compelling case against the 401(k) as a tool for ensuring long-term financial security. They urge individuals and families to diversify their savings and investments, building conservative portfolios that include bonds, high-dividend stocks, and savings. In the process, they explore the colorful social history of our love-hate relationship with the stock market and address many key questions facing any family today, such as: How do I accumulate enough wealth to educate my children and retire comfortably? How secure are my sources of income and how can I anticipate change? Timely and incisive, The Great 401(k) Hoax is guaranteed to inspire debate and action from the water cooler to the boardroom to the voting booth.

Reviews 2

Publisher's Weekly Review

Often considered an empowering way for employees to save for retirement, 401(k) plans began losing popularity with the recent bear market and took a harder hit after the Enron debacle. With stock prices declining, many employees face an uncertain retirement with no savings cushion to support them. Wolman, formerly Business Week's chief economist, and writer Colamosca say that 401(k) plans have always been an unfair deal for employees, but they're only now receiving negative press because of the Enron scandal. In fact, they believe the vast number of Americans counting on their 401(k) and other retirement plans will almost all be disappointed, and the country's economy is likely to suffer because of the overreliance on these plans. In effect, 401(k)s ask American workers to ape the investment behavior of the rich, even though they obviously do not have the resources to ride out bad markets of the kind we believe will prevail for the next decade. According to Wolman and Colamosca, the plans don't offer enough investment choices, and corporations reap substantial tax benefits while workers often end up with sizable tax bills related to plan withdrawals. Using historical references, the authors explain the stock market and common misunderstandings about retirement plans in easy-to-understand terms. Alas, the book's most important and practical part disappoints. Advice on alternate investment options for retirement is squeezed into two chapters. The authors' case is persuasive and will undoubtedly generate debate, but many readers, especially those whose portfolios have shrunk, may lament the lack of detailed investment counsel. Agent, Joe Spieler. (June) Forecast: Given the continuing publicity regarding Enron, and Wolman's reputation as a leading business journalist, this book is likely to generate media attention. Early sales are likely to be strong, but whether they'll continue is uncertain. (c) Copyright PWxyz, LLC. All rights reserved

Library Journal Review

Wolman, a former Business Week chief economist and a current commentator on CNBC, and Colamosca, a business journalist who has published in the Christian Science Monitor and the New Republic, offer a fast-paced, very readable, and critical examination of the 401(k) and its role in retirement funding. By examining the stock market in the 20th century and its booms in 1901, the 1920s, and mid-1960s, along with the years of stagnation that followed, and drawing parallels with the tech boom of the 1990s and the disappointing performance in the post-millennium decade we now live in, they support their thesis that "great stock market booms are followed by years of stagnation." Current participants in 401(k) plans have lost thousands of dollars during the past few years because of market decline. The authors suggest that people should now pay less attention to Wall Street hype, consider the accounting practices used to compile financial reports, and diversify by investing in stock index funds, bonds, and government securities, and they offer other useful suggestions for improving their situations. This timely and thought-provoking book by a well-known and highly respected economist and journalist offers a concise overview of the financial times we live in that will appeal to many library users.-Steven J. Mayover, Philadelphia (c) Copyright 2010. Library Journals LLC, a wholly owned subsidiary of Media Source, Inc. No redistribution permitted.