November 3, 2006 2:40 PM
A Sneak Peek Into Citigroup's New 401(k) Plan
Woo, up to 8% of company contribution into 401(k) accounts -- this is probably the highest among major companies. And you can expect that there are many finance-smart folks in Citi.
From WSJ:
Citigroup, the top U.S. bank, said it will end future contributions to the cash balance plan, and redirect the money to a revamped 401(k). Cash balance plans, a middle ground between traditional pensions and 401(k) plans, involve contributions funded entirely by the employer.
The new retirement savings plan, which Citigroup described as "greatly enhanced," could represent a major new expense when it takes effect in 2008. "In total, we will invest significantly more in our employees under this improved approach to our retirement savings," Citigroup Chief Executive Charles Prince wrote in a memo to U.S. employees.
Among the changes unveiled Friday is a new 401(k) plan that gives most U.S. employees the chance to receive a company contribution of as much as 8% of their annual pay, up from the current 3% matching contribution. The 8% contribution consists of a matching contribution of up to 6% and a 2% fixed contribution for employees whose salaries are up to $100,000 a year.
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