[getsoutalive]

The company only gave 401k matching contributions in the form of company stock and participants were not permitted to sell until they had reached age 50.

[BluH2o]

The company only gave 401k matching contributions in the form of company stock and participants were not permitted to sell until they had reached age 50.

The Enron employee interviewed on GMA had 21 years with the company. He appeared to be in his mid-fifties. He had tried to cash out a large portion of his 401K earlier this year and wasn't permitted to do so.

[Alberta's Child]

This is a different case altogether, and something still doesn't make sense. If the company only provided company stock as matching contributions, then what happened to the employee's original contributions? For the scenario described here to make any sense (i.e., a $500,000 retirement fund now worth only a few thousand dollars), the guy must have been buying company stock with his original contributions as well.

[Myrnick]

The company only gave 401k matching contributions in the form of company stock and participants were not permitted to sell until they had reached age 50.

That's true. However, since most companies don't match more than dollar for dollar on the first 6% (and that is at the very top end - most offer more in the way of $.50/$1 up to 3% or 4%), the worst it could be was a 50/50 split if one invested only enough to receive the company match and then diversified the remaining assets elsewhere. I have no sympathy for someone who put ALL their retirement assets into one company.

As for the issues regarding employees not being able to sell the stock, it is very common for assets to be "frozen" when a retirement plan is going through a significant change, and plan changes are not unusual. However, the timing of this particular change is very questionable.