New study shows 76% of 401k Participants have no confidence in their own definitions of investment terms. Free testing offered to 401k sponsors. New company offers simple low cost solution.
(PRWEB) October 24, 2003 -- John Middleton fixes jet engines. Ask him anything about jet propulsion and the workings of a commercial airliner and hell have an answer for you. When I get on a plane I feel good knowing that people like John, people passionate about the care and maintenance of jet engines, are on the job. One thing you dont want to do is ask John for financial advice.
John is one of over eight hundred and ninety two 401k participants who were asked to share the confidence level they have in their own idea of what certain investment terms and phrases mean.
The results? Well, lets just say, if John had the same degree of confidence in jet engines that he does in his knowledge of investing – I would take the train. Of the 892 whove participated in the survey thus far, here are a few of the results:
· Only 24% have enough confidence in their own idea of what a mutual fund is to make a serious financial decision.
· 100% indicate that they are 401k participants but only 37% consider themselves to be investors.
· Only 31% have enough confidence in their own definition of the S&P 500 to make a serious financial decision.
· Only 29% have enough confidence in their own definition of the term Growth Fund to make a serious financial decision.
· 37% indicates that President Bush will veto the Kerry-McKeene 401k Protection Act, 41% feel hell ratify the bill. The Kerry-McKeene 401k Protection Act does not exist.
This offers us a clue as to why its so difficult to educate 401k participants. Human nature stops most of us from admitting we dont know something. Especially when we've been surrounded by the terminology all of our lives.
401k Sponsors try. They hire consultants and experts. They invest in books and materials. But all of these solutions have one basic fundamental flaw. They speak in a tongue that the participants find familiar but simply dont understand. A good analogy would be the weather.
You understand weather, dont you? Youve been watching weather reports on TV and listening to them on the radio all your life. But, if someone told you, Your own personal financial security now depends on the confidence you have in your own idea of what weather terminology means,” you'd be in trouble. Do you really know what an isobar is? Relative humidity? (Relative to what?) Barometric pressure?
This is exactly what is going on when it comes to educating 401k participants. No one wants to raise a hand and ask, Whats a Growth Fund?” It would be like asking, Whats a tropical low pressure system?” They fear everyone else in the room would think, Wheres this guy been all his life? Mars?” Truth is, 70% of the people in the room have the same question. Yet, all they do is sit there and nod their heads.
Want to find out just how Wall Streetspeak-wise youre 401k participants are, at no cost or obligation? There's a free, very simple, online survey set-up to do the job. Drop us a line at wallst2mainst.com or an email and we'll help you can get the ball rolling.
And remember, if you want those who are participating in your 401k to understand it in no uncertain terms then simply stop using uncertain terms.
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