Monday, November 7, 2011

Advice and Retirement

This blog has devoted significant attention to potential regulations in Washington regarding retirement advice. Today the Wall Street Journal has a practical look at how workers are using that advice in the 401(k) market.

The good news is that more and more plans are offering advice. The bad news is that Americans are still not taking advantage of it.

Key points:

Survey after survey shows that formal advice leads investors to increase their savings, diversify their holdings and continue holding stocks even when the market takes a plunge.

But here's the catch: Only about a quarter of the people who have access to advice through their retirement plans actually take advantage of it, according to retirement-plan providers and firms that provide advice services. And most of those who do use advisory services neglect to provide the personal details that would make the advice more valuable.
The article ends with some practical advice for those with 401(ks) looking to learn about options that are available.