Thanks but No Thanks on 401(k) Advice

  • Written by David
  • November 8, 2011 at 1:32 am
  • 0
  • Source: WSJ: November 7, 2011

    An increasing number of plans offer outside help, typically for a fee. So far, most participants aren’t buying in.

    Amid volatile markets and concerns about how workers are investing their retirement savings, more 401(k) plans are offering participants specific investment advice and even automatic account management to make investing decisions easier.

    More employers are offering 401(k) investors access to outside portfolio advice. We look at whether these services are catching on and whether they are worth it.

    That should be a good thing: Survey after survey shows that formal advice leads investors to increase their savings, diversify their holdings and continue holding stocks even when the market takes a plunge.

    But here’s the catch: Only about a quarter of the people who have access to advice through their retirement plans actually take advantage of it, according to retirement-plan providers and firms that provide advice services. And most of those who do use advisory services neglect to provide the personal details that would make the advice more valuable.

    click here to read rest of story at WSJ

    WSJ.com Podcast

    More employers are offering 401(k) investors access to outside portfolio advice. We look at whether these services are catching on and whether they are worth it. Click here to listen.

 

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