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November 24, 2008
By Peter McDougal
TheStreet.com

In today's lean times, some companies are trimming expenses by halting the employer match on their employees' 401(k) contributions. In a recent survey by benefits consultant Watson Wyatt, 2% of 248 U.S. companies have already cut back on matching contributions and another 4% plan on doing so. If you start looking to trim your own expenses when money gets tight, don't take the same approach.

Long considered "free money" by many financial advisers, employer matches are a great motivator to get people to save for retirement. But the bulk of retirement savings still come from employee contributions. While dropping the match can help a company's bottom line, stopping your own contributions will hurt yours. Here's why: Missing out on even a couple of years of contributions now can leave you paying the price in retirement.

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