Cutting Costs in a COVID-19 World – Reducing or Suspending Company Contributions to a 401(k) or 403(b) Plan

In response to the current economic crisis caused by COVID-19, many companies are considering cost-savings measures to improve their companies’ financial stability. One such cost-saving option is the reduction or suspension of company contributions to a company’s 401(k) or 403(b) plan. The procedure for and the implications of such suspension will depend on the plan terms, including whether the contribution is intended to be a “safe harbor” contribution.