With all the turmoil in the stock market over the last couple of years—well, make that the last twelve years or so—it’s a good time to look at the toll it’s taken on the country’s primary private retirement system: the 401(k).

The Detroit News did last week, with a good look at the state of the system, with lots of evidence that it doesn’t work well.

For instance: The average 401(k) had $57,200 in it at the end of 2008. Presumably that average has risen considerably, but I’m guessing lots and lots of these folks—“retail investors” as Wall Street snickers at them—yanked their money out of stocks at or near the bottom. You know, “buy high, sell low.” It’s hard to blame them. The vast majority of people just don’t know much about investing.

The story’s author, Brian J. O’Connor, is good to note that that average is pulled down by young people who have been in the workforce for just a few years.

But half of the workers with less than 10 years to go before hitting the traditional retirement age at 65 had nest eggs of less than $40,000.

Which O’Connor helpfully points out would net someone just $204 a month for twenty years.

Another painful stat:

Nonetheless, in 2008, Hewitt found 28.4 percent of participants contributed below the company match threshold.

And:

Fidelity Investments, a large 401(k) provider, reported that at the end of June, more than a quarter of plan participants in their 50s either held all stocks or no stocks in their accounts.

O’Connor also points to the problematic patchwork system of retirement plans we have, with an advocate quote up top saying “It was a tax shelter for end-of-the-year bonuses for bankers… The 401(k) was never even intended to be a retirement plan.”

And further down, this paragraph:

Ghilarducci and other critics point to several key failings of the patchwork system of 401(k), 403(b), ESOP, Keogh, IRA and other plans in the alphabet soup of retirement investing.

Probably the worst part of 401(k)s is that they encourage investors to put their money in mutual funds in the like, which typically fail to meet overall market returns, and cream off a hefty management fee for the privilege (index funds are your friend, people. So is not putting all your eggs in one basket). Or they think it’s a good idea to put all their money into company stock.

Seems like this area is ripe for reform. Check out the sidebar for some ideas there.

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Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at rc2538@columbia.edu. Follow him on Twitter at @ryanchittum.