Despite the better intentions of finance professors a generation ago, the market regularly fails the efficiency test. The scary reality is not a question of what degree of market inefficiency exists, it’s that market inefficiency exists at all. And that can harm investors.
Tag "retirement"
The good news is 401k plan sponsors don’t need to treat this as a solo act. They’ve already got a team of hired hands to help them.
Plan sponsors – or, more specifically, the companies plan participants work for – may be placing employees in a far greater cyber-vulnerable position than they realize.
Many see the quarantine as a test run for retirement. There are those who view this “test run” and say they never want to retire. How do you dissuade them of this notion that they’re practicing retirement right now?
This isn’t free money. It comes at a price. Many naïve folks might be salivating at the prospect of releasing these big bucks from the prison of their retirement plan… until they read the fine print.
With the large influx of employees working from home, telecommuting may be here to stay. Companies need to rethink how they’ve addressed 401k communications in the past. One never knows when the “new” normal will appear.
Now is the time for 401k plan sponsors to seize their fiduciary mantle and provide the guidance and tools plan participants need to dodge emotional decisions that could ruin their chance for a comfortable retirement.
Perhaps, just as plan sponsors have developed onboarding programs for new hires when it comes to saving for retirement, maybe they should add “unboarding” programs as a bookend for those nearing retirement.
When you’re not an expert in an important job that you need done, what do you do?
Not being able to easily monitor how former employees apply these tools, however, can increase the fiduciary liability of plan sponsors.
