Brian Graff, Executive Director for ASPPA (American Society of Pension Professional and Actuaries) debunked 6 myths regarding to 401K retirement plans:

Myth 1 – tax deductions for employer contributions and pre-tax deferrals by employees in 401(k) plans are lost revenue for the government. Short term government revenue can be boosted by reducing the tax deductions with the expense of losing long term revenue while creating more liabilities for government.

Myth 2 – less than 50% of American workers are covered by retirement plans. In March 2011 the results of the National Compensation Survey conducted by the Bureau of Labor showed that 73% of full time American workers have access to a retirement plan and of that amount 80% of them use their plans.

Myth 3 – only the wealthy benefit from retirement plans. Not true, 74% of participants in defined contribution retirement plans (such as 401(k) plans) have family incomes below $100,000 a year. Thirty eight percent of participants earn less than $50,000 a year.

Myth 4 – 401(k) plans are inadequate. However, tabulations based on the EBRI/ICI 401(k) Accumulation Projection model show the replacement ratio for 401(k) plans and Social Security combined is over 100% for the lowest income quartile, and well over 80% other income quartiles.

Myth 5 – cuts to limits on retirement plans will only impact the wealthy.

Myth 6 – workers will save for retirement without a workplace retirement plan.