There is much debate on this subject. However since the 401(k) is now the primary source of retirement for many Americans it must look more like a pension fund than a supplement.

In a world where 24-hour, on-demand access to millions of consumer products is available via the Internet, you may expect that modern investors thrive when given a broad spectrum of investment choices. But recent research into investor decision-makingis finding that more is not better.Investors faced with too many choices become paralyzed and make bad decisions—according to a recent study from Columbia Business School and the University of Chicago Booth School of Business. [“Choice Proliferation, Simplicity Seeking, and Asset Allocation,” Sheena S. Iyengara & Emir Kamenica] These results expand on previous research that found that employees are less likely to enroll in an employer retirement plan with too many investment choices.

All plan participants would improve the performance of their plan by choosing managed portfolios based on risk levels.

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