NGPF Podcast: Tim Talks To Ted Benna, "Father of the 401(k)"
401(k) plans have gone from 0 to about $5 trillion in assets in just 35 years. They have become THE dominant way that people save for retirement today as pensions have become a thing of the past. Today on the NGPF Podcast, you will hear from the "Father of the 401(k), Ted Benna." You will hear about his "aha moment" that led to the birth of the 401(k), the challenges of getting employers and employees to adopt the program in the early years and his opinion of 401(k) plans today. Enjoy!
- 0:00–1:20 - Introduction
- 1:21–4:00 - His background and childhood money story
- 4:01–8:03 - His "aha moment" and the birth of the 401(k)
- 8:04–16:26 - Entrepreneurship: benefit consulting business & how he built it
- 16:27–20:27 - The year was 1978, and thus the 401(k) was created
- 20:28–25:44 - Testing, testing, 4-0-1: the pioneers try their hand
- 25:45–26:45 - It’s all smoke & mirrors when garnering media attention
- 26:46–30:19 - Initial reactions, facing barriers, and “enrollment meeting” strategies
- 30:20–34:18 - Investment choices and early implementation
- 34:19–37:50 - Short-term to long-term savings & the end to the glorified “Christmas clubs”
- 37:51–40:38 - Ted’s inside man, Secretary of Transportation, Andrew “Drew” Lewis
- 40:39–43:30 - The unfortunate IRA expansion and the 401(k)’s near death experience
- 43:31–45:17 -“Those who do not learn history are doomed to repeat it” –Karl Marx
- 45:18–47:12 - Where does the current presidential administration go tax from here?
- 47:13–51:04 - The long game of “forced savings”
- 51:05–57:39 - The challenge for investors and the problem for employers today
- 57:40–59:02 - More 401(k) plans, more problems (and Ted’s solution)
- 59:46–1:12:16 - Embracing target date funds
- 1:12:17–1:14:26 - How Ted would teach investing to students
- 1:14:27–1:17:32 - Are you a spender or saver?
- 1:17:49–1:19:26 - Life advice from Ted Benna
- 1:19:27–1:20:16 Conclusion
- Ted's website:
- Research on Educators’ 403(b) plan
- Early Mutual Fund offerings in 401(k) plans
- NGPF Resources
- “[The] 401(k) made [mutual fund businesses] what they are today”
- “You have to start early on and have that mentality that saving is a priority”