591: Ted Benna: A Look At The 401K 40 Years Later, The Pension Crisis & Corporate Owned Life Insurance

Ted Benna was working for an insurance firm outside Philadelphia
about 40 years ago when he figured out how to use an obscure
provision of a 1978 tax law—section “401(k)”—and turn it into an
employee retirement account for contributions from both employees
and employers. He designed it as a fringe benefit for banks that
wanted to save taxes when they transferred bonuses to employees.
In the years since, however, it’s grown into much more—it’s now
the dominant way that Americans save for retirement, helping them
collectively amass trillions.


Today, he’s proud that his invention has helped millions of
people prepare for retirement. But the plain-spoken Pennsylvanian
now says that the accounts have an “ugly” side—primarily that
they have made mutual fund companies and investment managers rich
off fees that grew way too high. He’s now on a crusade to design
simpler plans with lower fees that put money in the pockets of
future retirees, not money managers.


Ted Benna is commonly referred to as the “father of 401(k)”
because he created and gained IRS approval of the first 401(k)
savings plan.


 


Interview Links:


401K- Forty Years Later


Resources:



Create A Strategy


Become The Bank


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