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A recent report shows that 401k plans with automatic enrollment fared far better than those plans without.
The report also found 401k participants are not on track to retire by the age of 65. Over a third are taking on too much risk in their portfolios especially holding too much of their own company stock.
However plans with automatic enrollment the story is quite different, those plans with qualified default investment alternatives have a better level of risk and diversification.
It is advised that a 401k participate review annually your allocation and stock performance and make adjustments as needed.
You should at the very minimum contribute to the extent your employer will match your contributions. Some plans will automatically adjust amount contributed percentage wise up to the maximum amount allowed.
Personal experience with my clients has shown that many if not most companies’ fail miserably when it comes to educating their employees concerning their retirement options. So you might need to take it upon yourself to review all company benefits programs that are available to you.
