It might suit 401k plan sponsors and fiduciaries to tell this story of the generations to help the next generation avoid the mistakes of past generations. This tale provides many good tips about the dangers of investing in extremes, be they too conservative or too aggressive.
Investors
While retirees and near-retirees may be considering starting a small side business, many don’t have any entrepreneurial experience. How might they find answers to the questions they have?
If you’re over fifty, that gold watch gleams closer and closer. You start thinking. You start wondering. You start asking questions.
To address this requires employers to do more than having a periodic “employee education” meeting. While these can help (see the previous article), more need to be done. Plan sponsors need to consider how they (and, more importantly, their service providers) deliver messages to plan participants.
Not only does the typical plan sponsor not have investing in employee education as a high priority, but they also likely don’t have the wherewithal to monitor the consistency of how the provider runs the education program.
Retirees should think for themselves and what alternatives they have regarding their retirement assets. These aren’t the same as they were when they were working.
Those who work with retirees and people saving for retirement often have the best perspective when it comes to guidance pertaining to what is comfortable and what is not. It begins with a very simple definition.
More sophisticated plan participants who can afford to hire their own adviser. They don’t ask more from the plan. They ask for less, in hopes of gaining more control over their own destiny. For a variety of reasons, this isn’t as easy as some participants would like it to be.
This doesn’t mean you shoot haphazardly for the stars when you can have the moon. After all, you’ve got to know your limitations. Seeking unreachable goals will only make your retirement seem hollow and pointless.
When it comes to retirement anxiety, it’s best to set aside all those matters that fall outside your ability to manage. You can’t change everything. Focus instead on what you can change.
