10 Companies with the Best Retirement Plans

Fewer companies are offering retirement benefits these days – and for the ones that do, many are scaling back their plans.

“The old, traditionally-defined benefit-pension plan is pretty much gone,” said Milton Moskowitz, who’s been compiling an annual list of the “100 Best Companies to Work For” for more than 25 years. “Employees don’t seem to stay with companies a very long time. So companies don’t feel the need to offer the security to keep them there.”

But even in this era of cost-cutting, there are still some companies offering great retirement plans.

Moskowitz said a good standard to shoot for when considering a potential employer is a payout of at least 50 percent up to 6 percent of your pay -- that means, you contribute up to 6 percent of your pay and the company matches half of whatever you put in.

Of course, 100 percent is ideal – and there are some companies offering dollar-for-dollar matching – and some even offer free financial-services planning for employees.

To give you a leg up on your research, here are 10 Companies With the Best Retirement Plans.

By Cindy Perman
Posted 21 Sept 2010

Headquarters: Oklahoma City, Okla.
Number of Employees: 9,100
Year founded: 1989

Chesapeake Energy,an oil- and gas-exploration company based in Oklahoma City, has one of the highest matches – 100 percent up to 15 percent of an employee’s pay.

The catch is that the match is entirely in Chesapeake stock, which has fluctuated from $11 to more than $60 a share in the past year. It’s currently around $20 a share. However, the investment vests 20 percent each year and once fully vested, employees can transfer their personal contribution to one of 27 different investment options.

Plus, the company provides quarterly financial training to all employees.

They have a 90 percent participation rate in their plan, with employees contributing an average of 9 percent of their base salary and 15 percent of their bonus – well above the average deferral rate of 8 percent, according to Fidelity.

Headquarters: Oklahoma City, Okla.
Number of Employees: 5,000
Year founded: 1971

Devon Energy,also from Oklahoma City, offers an incentive for employees to stick around: They have a match that increases the longer an employee stays with the company.

An employee can choose to forego the traditional 401(k) and pension route and opt into an “enhanced defined contribution,” where the company will contribute 8, 12 or 16 percent of the employee’s salary – regardless of whether the employee contributes. Plus, for employees who contribute, they’ll match 100 percent up to 6 percent. So, an employee could get as much as 22 percent of their salary contributed by the company to his or her retirement account.

The real upside to this plan – it’s all cash, no stock. (The company’s stock, like Chesapeake, has fluctuated wildly in the past year, swinging between $40 and $120. It’s currently around $60.)

Devon makes having a competitive retirement plan a priority, said Sue Alberti, VP of compensation and benefits. “The retirement portfolio we offer to employees is an integral part of our recruitment and retention strategy.”

They also offer free one-on-one counseling sessions with a financial adviser and retiree health plan for employees with at least 10 years of service.

Headquarters: San Diego, Calif.
Number of Employees: 12,800
Year founded: 1989

Qualcomm,which makes chips for smartphones and other wireless devices, has structured its 401(k) so that the employees at the lowest end of the pay scale get the highest matching.

It matches 100 percent up to the first $1,500 an employee contributes, then it’s 50 percent for the next $1,500, and 33 percent for the next $7,500. After that, it’s 10 percent.

“The point is that lower-income employees can’t contribute as much as someone earning more – therefore, the company will match them at a higher rate,” Moskowitz said.

And it’s not because they’re dependent on the lower end of the payscale. On the contrary, they’re loaded up with PhD engineers.

"It’s more of a social thing – doing good by lower-income employees,” Moskowitz said.

Headquarters: South San Francisco, Calif.
Number of Employees: 13,000
Year founded: 1976

Genentech,a biotech company that makes drugs that treat a variety of life-threatening medical conditions, offers a pretty healthy plan, matching 100 percent up to 5 percent of an employee’s pay.

Plus, the company automatically makes an additional 2 percent contribution, regardless of the employee’s participation in the retirement plan.

Genentech was bought by Swiss drug maker Roche last year but Roche has been careful to preserve the culture and practices of the company, which has the reputation of being a great place to work. In fact, Roche handed out $375 million in retention bonuses to the ranks of Genentech to prevent defections.

Headquarters: Redmond, Wash.
Number of Employees: 88,600
Year founded: 1975

It’s a long way from 1975, when a young computer whiz dropped out of Harvard after just two years to start what would later become one of the biggest software companies in the world.

Today, founder Bill Gates is one of the richest men in the world and Microsoft has earned its place on the best retirement plans list by offering to match 50 percent up to 6 percent of an employee’s pay.

Employees are immediately eligible and immediately 100 percent vested.

There are three tiers of investment offered, depending on the employee’s experience and interest in investing. The company also offers a financial-education program for employees.

Over 87 percent of employees participate in the retirement plan.

Headquarters: Columbus, Ga.
Number of Employees: 4,276
Year founded: 1955

Aflac,an insurance company, known for its squawking spokesduck, offers a one-two punch for its employees: They’ll match 50 percent of employee contributions up to 6 percent but also offer an old-fashioned defined-benefits pension plan that follows the rule of 80: When your age and years of service add up to 80, you can retire no matter how old you are.

Vesting is five years for both plans, with 20 percent vesting after the first year and 40 percent after the second year.

Plus, being an insurance company, they can offer an added perk: Health and life insurance for retirees, subsidized by the company so it’s at the same rate as current employees.

The participation rates are solid: 85 percent of employees participate in the 401(k) plan and 94 percent participate in the pension plan. The average employee contribution is 8 percent.

Headquarters: San Antonio, Texas
Number of Employees: 22,000
Year founded: 1922

USAA,which provides financial services to military families, provides a rich retirement plan for its employees: They match dollar for dollar up to 8 percent of an employee’s pay, plus they contribute 9 percent every year to a cash balance pension plan.

Plus, if the company hits certain performance targets, they provide employees with a bonus contribution to their retirement savings, which varies from 3 percent to 9 percent, depending on the employee’s age. That means they could end up saving the equivalent of 19 to 25 percent of their pay each year.

Employees are automatically enrolled and get their first contribution with their first paycheck and the account is vested after just two years. The company also offers subsidized health care for retirees.

USAA is big on financial education, with an in-house team of financial advisers and free personal financial planning seminars for employees.

Headquarters: New York
Number of Employees: 38,100
Year founded: 1806

“They’re an old-fashioned company – over 200 years old – so they do a lot of things differently,” Moskowitz said of Colgate-Palmolive’s retirement plan.

Colgate-Palmolive,which makes everything from toothpaste to deodorant and dog food, offers a plan that bets heavily on the company: They have a savings and investment plan, where employees contribute up to 15 percent of their pay, tax-deferred. Plus, they match 50 percent to 70 percent of the employee’s contribution – up to 6 percent of their salary.

“If the stock does very well – you do very well,” Moskowitz said.

The company also offers a retiree health-insurance plan, funded completely by the company – using preferred stock. Basically, how it works is that when you retire, you can use the money from those shares the company gave you to pay for your health insurance.

And, they pay 100 percent of the costs of a financial-planning course, up to $10,000 a year.

Headquarters: McLean, Va.
Number of Employees: 7,000
Year founded: 1958

Mitre is a nonprofit organization, which manages federally funded research and development centers for the Department of Defense and other government agencies. They only have about 7,000 employees but many of them are researchers with advanced degrees.

Like several other companies that made the Best Retirement Plans list, Mitre’s focus is on retaining its talent, so they offer a generous retirement plan that could pay employees 80 percent to 100 percent of their salary after they retire.

The company's match, when combined with employee contributions can be up to 12 percent of an employee's salary. Vesting is immediate.

Employees have over 100 investment options to choose from for their retirement funds, ranging from conservative to aggressive. Plus, the company offers a variety of financial-education options.

Currently, 99 percent of employees are participating in the plan.

Headquarters: Lakeland, Fla.
Number of Employees: 142,000
Year founded: 1930

Publixis a grocery chain in the southeast U.S. that boasts a “very unique corporate culture” – It’s entirely employee-owned and -managed.

Pay isn’t typically great in the supermarket industry, Moskowitz noted, but Publix uses the employee ownership of the company as a way to fund their retirement.

The company offers an employee stock ownership plan (ESOP) as part of its retirement plan, as well as a traditional 401(k). The average company contribution to the ESOP is 10 percent of wages. The average annual return on the stock is 17 percent.

“We believe our philosophy of employee ownership contributes to our success,” spokeswoman Maria Brous said.

Moskowitz said the best way to learn about a company is by speaking to someone who works there. Sites like Yelp.comand Glassdoor.com,where people talk about what’s good and bad at their company, are also great sources to learn about a company – and what benefits they offer.