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Friday, July 08, 2011

Inertia and your 401(k)

Inertia can be good and bad.  If inaction causes desired behavior, then inertia is positive. When your employer automatically signs you up to save for retirement via the 401(k) and places the savings in an age-appropriately allocated portfolio, that's a good thing.  However, if they set aside too little, you may not be saving sufficiently for your retirement, and that's probably not a good thing.  If you are at an employer, with an automatic feature for the 401(k), check your automatic savings defaults at your employer, don't rely on inertia.  See if you need to take some additional action.

401(k) Law Suppresses Saving for Retirement (wsj)

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