Many employees are in a tizzy over recent dips in 401(k) balances caused by the volatile markets.

As monthly and quarterly account statements come out, the concern may grow worse before it gets better.
The drops are directly related to the collapse of investment bank Lehman Brothers, the buy-out of Merrill Lynch and the bailout of troubled insurance company AIG.

Stocks and bonds issued by Lehman, Merrill Lynch and AIG are widely held by 401(k) mutual funds as well as defined-benefit pension plans.

Example: Fidelity and Vanguard mutual funds were two of the largest owners of Lehman stock, holding 6% and 3%, respectively. Many pension funds also hold Lehman stock.

Your employees probably don’t know this: Most folks are unaware of the particular holdings of stock and bond funds in which their retirement savings are invested.

But they can log into their accounts or check their statements. That’s why it’s important to let folks know that the downturn in retirement accounts isn’t a permanent situation.