I meet with new individual company 401(k) retirement plan participants just about every week. The first thing I want to accomplish is to present my qualifications and experience in analyzing a company 401(k) retirement plan mutual fund menu.
The second thing that needs to happen is for the individual company 401(k) retirement plan participant to admit their past investment management mistakes.
Long-term company 401(k) investment management decisions can be dramatically improved. That fact can make a difference in the size of your retirement savings and the ability to live a comfortable retirement.
There was a great story recently on the Inc.com web site titled, “The Surprising Personality Trait That Massively Improves Decision-Making, According to Science.”
I see the need for intellectual humility in just about every individual company 401(k) retirement plan participant that I meet. Many high-powered doctor, lawyer, consultant, and Fortune 500 company employees have a very difficult time admitting their past company 401(k) retirement plan account investment management mistakes.
Many individual company 401(k) participants can’t get the buy-and-hold investment management concept out of their heads. They are destined to accept the poor investment results that come from hanging on to their bad investment choices through up-and-down stock market cycles.
The buy-and-old or set-it-and-forget-it model has failed individual company 401(k) retirement plan participants over the years. Investment management technology available today makes those strategies outdated and obsolete.
The widely-marketed investment management concept of “diversification” needs to suffer the same fate as buy-and-hold investing. Both investment management concepts fall into the category of “strong opinion, weakly held.”
Humility in any decision making is important. I have found that it is also a very expensive lesson to learn for individual company 401(k) retirement plan account participants.
Ric Lager
Lager & Company, Inc.
