Preston Crabill, director of employee benefits and human resource operations at GM, noted recent academic research that indicated having too many investment choices in a 401(k) plan can lead some participants to pick the most conservative investment option and discourage others from participating at all.

“We do believe that by reducing the fund lineup, we should see an increase in participation, an increase in the savings rate and also a better diversified portfolio on the part of our participants,” Crabill said.

Starting June 29, GM’s plan for salaried employees will offer 39 choices, down from 73, and the plan for hourly employees will offer 38 choices, down from 71.

At the end of 2006, GM’s 401(k) assets totaled $20.2 billion.