Thirty percent of 401(k) account investors who retired, changed jobs or temporarily left the work force took a cash payment from their accounts, according to a study released today by Putnam Investments. Some 39% of investors age 18 to 34 took the cash option rather than other options, including IRA rollovers, noted the survey of 1,500 plan participants and IRA investors conducted last month.
Putnams survey, "Retirement Savings in an Unsettled Economy, also indicated that 79% of those eligible for 401(k) plans expect to add to their accounts in 2001. The average additional contribution this year is $3,600.
Participants in 401(k) plans reported losing an average of 6.3% in the preceding 12 months, with their account balances dropping to an average balance of $41,900. Participants attributed the decline to the downturn in equity markets.