The Case for Saving for Retirement via Index Funds

Andrzej Sławiński, Dobiesław Tymoczko

Abstract


The ongoing reforms of the pension systems tend to shift the consequences of the investment decisions onto the prospective retirees who usually remain unaware of the factual costs and risks associated with long-term investing. It is therefore necessary that they should be taught that saving for retirement via index funds is the most rational decision for their pension plans. The prospective retirees should be informed that deviating from investing in inexpensive index funds means de facto their (typically unconscious) consent to share a large portion of their investment gains with actively managed funds charging much higher fees.


Keywords


saving for retirement; pension investment; index funds

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References


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DOI: http://dx.doi.org/10.17951/h.2017.51.4.281
Date of publication: 2017-12-08 15:26:47
Date of submission: 2017-04-05 21:23:02


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