Which of the following is NOT a characteristic of 401(k) retirement plans?

401(k) retirement plans are indeed employer-sponsored plans that enable employees to set aside a portion of their income for retirement, often with contributions from their employers. One of the key characteristics of these plans is their accessibility; they are available to both private and public sector employees, not just exclusively for public sector employees. Therefore, stating that they are exclusively for public sector employees is incorrect.

The statement regarding employer matching contributions reflects another common feature of 401(k) plans. Many employers offer matching contributions as an incentive for employees to save for retirement, which further supports the growth of the employees' retirement funds.

Additionally, the option about allowing investments through variable annuities is also a valid characteristic of some 401(k) plans, as they often provide various investment options, including mutual funds and variable annuities, allowing participants to choose how they want to grow their retirement savings.

Thus, identifying that 401(k) plans are not limited to public sector employees clarifies why this particular statement does not align with the true characteristics of 401(k) plans.