Why AOL's 401(k) Plan Matters to You

By Chris Hill – Feb 10, 2014 at 7:31PM

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AOL's recent 401K controversy could be part of a broader trend, impacting both employees and investors.

In this video from Monday's edition of Investor Beat, host Chris Hill and Motley Fool analysts Taylor Muckerman and Matt Argersinger dig into the biggest investing stories from the market today.

AOL (NYSE: AOL) CEO Tim Armstrong announced over the weekend that the company will reverse a recent change to its 401(k) plan. The company had recently shifted to giving employees a lump-sum contribution rather than matching throughout the year, a move that saves the company money but isn't beneficial for employees. Armstrong said that part of the change was due to "two distressed babies" in 2012, which cost the company about $1 million each. Armstrong has since apologized for the remark. In the lead story on today's Investor Beat, Matt and Taylor discuss the recent trend toward lump-sum contributions to 401(k) plans, why this is beneficial for companies, and why it isn't ideal for employees.

Chris Hill, Matthew Argersinger, Taylor Muckerman, and The Motley Fool have no position in any of the stocks mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.