At first glance, it appears higher total fees may present the greatest challenge when contemplating the number of options in a 401(k) menu. While this may be true (see “How Many Investment Options Should 401(k) Plan Sponsors Offer?”), evidence suggests too many options both demotivates employees and leads them to make incorrect decisions.

One of the most cited papers on this subject is was “When Choice is Demotivating: Can One Desire Too Much of a Good Thing?” by Sheena S. Iyengar and Mark R. Lepper (Journal of Personality and Social Psychology) concludes that subjects given a choice of six chocolates to choose from felt more satisfied than subjects given a choice of 30 chocolates to choose from. The study also determined choice is not bad. Both the six-chocolate subjects and the 30-chocolate subjects felt greater satisfaction than the group given a “choice” of only one chocolate.

Complete your profile to continue reading and get FREE access to BenefitsPRO.com, part of your ALM digital membership.

Your access to unlimited BenefitsPRO.com content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Critical BenefitsPRO.com information including cutting edge post-reform success strategies, access to educational webcasts and videos, resources from industry leaders, and informative Newsletters.
  • Exclusive discounts on ALM, BenefitsPRO magazine and BenefitsPRO.com events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com

Already have an account?


NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

BenefitsPRO

Join BenefitsPRO

Don’t miss crucial news and insights you need to navigate the shifting employee benefits industry. Join BenefitsPRO.com now!

  • Unlimited access to BenefitsPRO.com - your roadmap to thriving in a disrupted environment
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com
  • Exclusive discounts on BenefitsPRO.com and ALM events.

Already have an account? Sign In Now
Join BenefitsPRO

Copyright © 2024 ALM Global, LLC. All Rights Reserved.