Julius Caesar once said "Experience is the teacher of all things." For 401(k) investors, experience is often the sole teacher. We've seen quite a few 401(k) investors experience the fine fruits of a lifetime of investing discipline. For too many investors, though, it's only when they're older and "experienced" do they finally understand the missed opportunity of taking correct action in their younger years. If lack of experience is the disease, then a good 401(k) education program is the cure.
Alas, we regrettably see 401(k) education losing the priority battle to investment style arguments, day-to-day business needs and the goings-on of everyday life. Worse, when naïve 401(k) plan sponsors finally agree to support an education program, they frequently cede its design to a conflicted service provider with an aptitude better suited to sales than teaching.
By definition, plan sponsors are expert in their business, not in behavioral finance. Notice what I just said: "behavioral finance." Notice what I didn't say: "investments." Even many financial professionals confuse a good 401(k) education program with a good investment seminar. Nothing can be further from the truth.
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