401(k) Plan                                                       Multiemployer Defined
                                                                                      Benefit Plan (NPP)

There is no guarantee of benefit amounts            ~            Benefits are established by the
and benefits are not insured.                                             Plan's benefit formula and vested
                                                                                       benefits are guaranteed by the
                                                                                       Pension Benefit Guarantee
                                                                                       Corporation.

Amount at retirement or termination of                ~            Benefits are not adjusted for investment
employment is directly related to investment                      gains or losses.  However, good
success.  Many employees lack the                                   investments lead to benefit improvements.
investment knowledge to make wise
decisions (even a brief period of poor
investment performance can have a serious
impact on retirement benefits).

Benefits are payable only until account is            ~             Benefits are payable for life, with
exhausted (longevity risk).                                                 joint and survivor annuity option
                                                                                        (pensioners cannot outlive their
                                                                                        pensions).

Disability benefits normally are not provided.      ~              Lifetime disability benefits are
                                                                                         provided to qualifying vested
                                                                                         participants.

If lifetime annuity is purchased from lump            ~              Increases in pension amounts and
payout, no further benefit increases are                               bonus checks have been granted
provided.                                                                           periodically by NPP Trustees.

Voluntary contributions plus contributions          ~              All contributions are made by the
matched by employer are usually contingent                       employer.  No FICA is withheld
upon participant's ability & willingness to                            on amounts contributed.
make contributions.  Employee contributions
are made from salary after FICA is withheld.
 
 

The information provided is in no way exhaustive of the subject of defined benefit plans versus 401(k).  The 401(k)  is an excellent supplement to an existing Plan.  However, a single employer plan generally cannot provide the range of benefits and services provided by a multi-employer plan.

It is not possible to project benefits under a 401(k) because of the variable involved in selecting the investment vehicle.  While some vehicles provide contractual guarantees on interest application, timing of the application of interest to individual accounts significantly changes the account growth.  In addition, most 401(k) programs have stock accounts which fluctuate with the market as well as combination plans.  Many 401(k) plans have a "load" where a percentage of each dollar invested is used to pay administration charges and commissions.