McDonald's pioneered the process in the late 1980s as a way to get its young workforce to save. Savings is a habit, and once you get the habit, it's really hard to break. Boeing, for instance, went from five to 11 funds this month. And Sears, which now has five, intends to add many more next year. They are the extreme of the more-funds trend.
Most brokerage accounts permit employees to trade virtually any U.S. stock, bond or mutual fund.
In both cases, employees pay additional fees. These are for employees who don't want to deal with investment decisions. The funds are blends of stocks and bonds. Employees pick one based on their investment goals and ability to tolerate risk. Some companies resist offering a lot of funds because they fear employees will become confused.