Now, many are wondering what went wrong. For the year ending February 24, 2016, Morningstar's longer-term TDF categories, with target retirement dates between 2036 and 2051, lost between 11 percent and 12 percent in value. Over the same period, the S&P 500 Index lost just 6.81 percent.

It's common sense that young people should dip their toes into investing gradually, take modest risk at first, and learn as they go. In TDFs, however, they are hurled immediately into the riskiest end of the investment pool, with huge exposure to equities in general, and high-risk equities specifically. The biggest reason TDF funds lagged the S&P 500 over the last year was their exposure to under-performing small-cap and foreign stocks.

Yet, because most QDIA participants don't make active investment decisions and lack access to advisors, they don't even know why their accounts are down so much. Anecdotally, many millennials now have a very bad taste in their mouths about 401(k) plans in general. But it's not the plan that has failed them.

Rather, it's the plan sponsor's choice of offering a QDIA – a mistake which, according to Vanguard, virtually all sponsors make. There are many problems with using TDFs as QDIAs, and you will find them documented in a comprehensive General Accounting Office report.

In summary, the report says the mutual fund industry rushed headlong to embed TDFs as a panacea QDIA choice, without clearly describing their risks, problems or key differences among funds. After reading it, you should make efforts to discuss with plan sponsors in your market the logical alternative to QDIAs.

It is to offer participants access to professional advice and education, so they are empowered to make their own plan investment choices. Also, you may want to talk to the disillusioned millennial children of your clients and help them take charge of the plan investment experience, so they can put the bitter taste of TDFs behind them before it is too late.