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Retirement Plans Don’t Have To Give You A Cash Option

Tuesday, August 23, 2011 - 8:35 AM
From NYTimes.com
The recent wild swings of the stock market had a lot of investors seeking the safety of cash, at least temporarily. One Bucks reader wrote to lament that the retirement plan offered by his former employer, a large not-for-profit institution, lacked what he deemed suitable options for putting investments in cash.

That made us wonder: is there any requirement for plans to offer at least one cash-equivalent option?

Regardless of whether you think parking any of your nest egg in cash is a good idea, it might be comforting to have that choice. So we put the question to the federal Department of Labor, which helps oversee private retirement plans under the Employee Retirement Income Security Act of 1974, known as Erisa.

The answer: No.

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