Economic theory provides the basis for making these types of choices, but the average employee may not have developed the skills or the interest to formally evaluate the alternatives. And, in fact, recent research has found some troubling patterns: Many workers do not participate, contribute only a small portion of their wages if they do participate, and make questionable investment and distribution choices.
Let me take a couple of minutes to cite some telling facts about individual savings in 401(k) plans, suggesting that workers may not be giving adequate attention to their savings in the retirement plans sponsored by their employer.