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Stock Answers

Workers need 401(k) advice? Too bad! You can't give it! This new bill may change that.

This story appears in the March 2002 issue of Entrepreneur. Subscribe »

Maybe the "K" in 401(k) stands for "krazy." That's how the 48 million Americans who own these retirement plans feel watching the stock market. One could argue that what they need most is fewer Enrons, but some in Congress say better investment advice from employers is the answer.

Right now, entrepreneurs can't bring in investment advisors to help workers allocate their pension plan assets because the 1974 Employee Retirement Income Security Act (ERISA) makes employers liable for any advice given. The Retirement Security Advice Act (H.R. 2269), sponsored by Rep. John Boehner (R-OH), would change that. Passed by the House, it eliminates the ERISA liability--though employers remain responsible for prudently selecting and reviewing the advisor.

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