Adults learn differently than children or even college students, something most undergraduate executive education programs know and practice. However, financial services, especially the 401(k) industry, have yet to learn these lessons.

Defined contribution plan sponsors and participants are uniquely challenged. Plan administrators step into their roles with little or no training to navigate ERISA, which some compare to the gods of the Old Testament—too many rules and too unforgiving. Plan participants are even more challenged to do so manage their personal pension plan, which includes determining how much to save, where to invest, and regularly rebalancing and adjusting.

No wonder the DC industry has so many critics, now including a New York Times columnist who recently asked: “Was the 401(k) a mistake?” It's not because the DC system has fallen short of its original goals—in fact, it's far exceeded it. This is because society now expects much more than just accumulating assets for retirement with critics asking if there are better ways to allocate 1% of GDP.

Moving forward, plan sponsors and participants need a lot of training to understand and properly use:

• Managed accounts or more personalized investments
• Retirement income within the plan
• Convergence of wealth, pension and benefits, which include:

  • Financial planning
  • Debt management
  • Optimal use of the benefits offered
  • Paying off student loan debt
  • Emergency savings
  • Health savings accounts
  • Non-qualified plans

Few are those who ask for these things, because they really do not understand or know about them. Much progress has been made by automatic features, but there is a limit. At some point, sponsors and participants need to be properly engaged and counseled, otherwise the government will use the distribution to increase social security and put everyone on Thrift Savings Plans.

Watching the executive education group at the UCLA Anderson School of Management collaborate on the C(k)P program taught me a few things about how to best teach adults, including:

• Environment – ​​Although not always an option, adults pay more attention in the right environment such as a classroom in a college rather than a hotel or office building. When they feel like they are being sold something, they shut down.
• Interaction – Adults do not learn by listening; they learn by interacting. Due to compliance and lack of training, most industry speakers lecture, not inviting interaction.
• Peer-to-Peer – Adults trust peers much more than experts. Even training programs that include great speakers covering relevant topics miss the mark because in the back of their minds, the audience is thinking, “That may be true, but you don't know what it's like to be me.”

When we enter school, and for most of elementary school, we accept what the teacher says. From high school, we begin to question, which increases as we move into college. But we still don't have much life or professional experience, which is why peer learning is so much more powerful for adults.

The financial services industry also tries to teach people a new language with different rules—why not speak their language and use analogies they understand?

If we want to start a fire through education and training, we need the right fuel (content and speakers) in the right environment (away from the wind), set right (agenda). But to fuel the fire, we need peer interaction and learning. It pains me to see the amount of money the DC industry spends on education with little to no change in behavior and the proliferation of online certification of professionals.

So when you plan training to sponsor clients, live and, if possible, in person, why not invite all of them, as well as prospects or their colleagues and allocate a significant part for interaction or even do you have them present? When training participants, why not use those who are doing well and let them speak? After all, can we build online communities augmented by live meetings and personalized advice using technology to scale it?

Because if the DC system will be judged by results, not only by purpose or activity, we need to incorporate the many new and exciting services and features now available to plans and employees through the convergence of wealth, retirement and benefits, which will only happen through proper and effective education and training. But not in the ways we have done in the past if we expect different results.

Fred Barstein is the founder and CEO of TRAU, TPSU and 401kTV.