The difference is that the 401k the matching contributions go into the employee's fund immediately. The pension is really just a promise of funds in the future.

The difference is that the 401k the matching contributions go into the employee's fund immediately. The pension is really just a promise of funds in the future. Historically pensions have been: a) reneged on by the employer b) underfunded by the employer It is correct to say that there is no reason a reasonable pension couldn't be just as good as a 401k, but it hasn't played out. The money keeps getting spent twice. I personally think this is nothing short of criminal. Because of the way the 401k works, the money can't be double spent, and you didn't have this problem of the retirement funds 'disappearing'.