401(k) participants who receive face-to-face investment advice last year achieved an annual investment return 2.5 percentage points greater than those who did not receive advice, according to a study by Carroll College of Waukesha, Wis., and Francis Investment Counsel.
In addition, employees who both participated in group retirement education sessions and received individual investment advice invested in an average 7.8 mutual funds each, compared with 5.6 mutual funds each for employees who used group retirement education alone and 5.3 funds each for employees who received no education or advice, confirmed Stephanie Truog, spokeswoman for Francis Investment Counsel. The additional diversification resulted in reduced portfolio volatility — 0.19% variance in returns for the first group vs. 0.26% variance for the second group and 0.27% for employees who received no education or advice.
