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To some, even free money is not sufficiently attractive………… May 15, 2015

Posted by forwardfinancialplanning1 in 401k plans.

One of my friend’s favorite sayings is, “You can’t fix stupid.”  And while we can’t dismiss the behavior described below as merely ‘stupid”, it sure has to be on the list.

Much has been written about America’s collective failure to save enough for retirement.  Financial Engines has done an analysis of the 401k plans it works with and they have found that “free money” is not even a strong enough incentive.  Financial Engines found that 25% of 401k plan participants do not contribute enough to capture all of the employer’s matching funds.  In total, this represents $24 billion of forsaken contribution matching dollars or an average of $1,336  per employee annually.

I once heard matching dollars described as “the easiest money you’ll ever make.”  Apparently for many, it’s not easy enough!!!!



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