[njarboe]

This would work for some people. How many stock market crashes have you lived through? I vaguely remember 1987, but did not have skin in the game at that point, so no lessons learned (but no wrong lessons learned?). I had money in the market during the dotcom crash where the Nasdaq dropped 78%. My dotcom holdings were mostly eBay at the time, so I was not as impacted as many. Then the 2008-09 madness. At some point I split investments between my long holdings and a double short SP500 fund for around a year to save my sanity. Since then a bull market and I bought a chunk of Tesla at $21. Good times. I have made out alright, but really like thinking about financial matters.

I know many people in their 50's that during the dotcom and real estate crashes could not stand the losses and sold near the bottom and are still in all cash. Seems like controlling your own retirement assets is a good system to transfer money from regular people to the market makers/full time stock investors. I think some kind of annuity that you buy every year that kicks in at age 65 or 70 is what most people want. Too bad those have really high commissions and horrible returns.

[bassman9000]

* like controlling your own retirement assets is a good system to transfer money from regular people to the market makers/full time stock investors.*

Who said you have to? Fidelity, Securian, and the likes all offer balanced, automated, diversified 401ks and IRAs. Check the plans, and tell me if there's any concentrating on a given sector.

[njarboe]

Maybe I was a bit obtuse but the transfer comes not from poor diversification (although that can be a problem) but market timing. When a person in control of their retirement fund and has a diversified retirement account, just like the experts say, they eventually build it up to a decent amount. Now they start to pay attention to the losses and gains. If stocks now go crazy for a few years, all the hype and past missed gains are so great they sell their bonds and buy stocks near the peak. Then the market crashes and they sell near the bottom for a 50% loss. Then they have been so burned they just keep it in cash and miss out on making it all back and then some in the next bull market. The really unfortunate (stupid?, greedy?, gullible?) people cycle through this more than once. I know I'm not immune.

Not sure how one would set up a system where people can control their own retirement funds and yet not control them. Some system where you can only trade with a one month lead time? Or only allow people to buy those timed funds that mix and match highly diversified stock and bond funds depending on your age. Seems like a hard problem.

[dahdum]

Forced 401k savings would work, but forcing annuities would cut returns through high fees, and removing too much risk too early.