The DC Disconnect

As we get into the implementation stage of the Tier 3 pension, you will hear a lot about the need to "train" employees to do their own investing, whether it's investing within the DC supplement or the DC-only option. Much of this talk will come from the administration. When you hear it, think about the chart below, particularly the discrepancy on the right-hand side of the figure:

And, of course, no matter how much training you might have, it can't shield you from all longevity and investment risk.

Source of study underlying chart: http://squaredawayblog.bc.edu/squared-away/401ks-an-employer-employee-disconnect/