Image Credit: Alex Nabaum

Imagine a savings vehicle that allows you, in retirement, to withdraw as much or as little as you wish—tax-free.

This vehicle, the Roth 401(k), is a great tool for many savers, as my colleague Laura Saunders has pointed out. Why don’t more people take advantage of it?

The likely culprits are the inertia and myopia of savers and retirement-plan providers—as well as a possible conflict of interest at investment firms that are supposed to put their clients first. (A regulation the Securities and Exchange Commission introduced this week to make brokers act in clients’ best interest would do nothing to mitigate this kind of conflict.) As usual, the obstacles to building wealth are rooted in psychology and hidden incentives….

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