The Foolishness of Most 401(k) Plans – Unfortunately, most 401(k) plans only allow investments in mutual funds whose high administrative fees eat into the returns of the participants.  This fact increases the likelihood of loss as most investors chased performance versus being strategic investors.  Case in point, Peter Lynch the famed money manager of one of the best performing mutual funds (The Magellan Fund) from 1970-1990 documented that most investors in the Magellan Fund lost money because they never stuck with it and were constantly chasing performance.  Therefore, until employers can structure their 401(k) Plans for employees with much more flexibility and not just more mutual funds, the likelihood is that most employees are going to suffer further losses in their 401(k) plans if they remain in the broad overall market that is presently being manipulated by the Wall Street elites with all the government stimulus money. The market has only recaptured about half of what it lost in 2008 and just like the 30s is going to take a dive perhaps worse than it did in 2008. Consequently, to take advantage of this prolonged recession with many more financial surprises on the horizon, the general population better learn how to be strategic investors.