Most people in these plans have no idea how to manage them. That’s why your employer should help you. After all, there’s no point in providing employees with this benefit if you don’t help them get the most out of it. It’s like giving your son or daughter a car and never ensuring that they know how to drive safely. Most 401(k) accounts crash before reaching their destination.
The Pension Protection Act of 2006 allows plan sponsors to automatically enroll their employees in age appropriate managed portfolios. This single feature will improve performance results and reduce fiduciary risks. Making the 401(k) plan more like a pension plan will be very attractive to current and prospective employees.
Please comment or call to discuss how this affects you and your company.