There are several issues with 401ks and the analysis. 1) people don't stay at the same company for years, so many will have multiple 401ks or more likely their 401ks get cashed out.. which undermines the whole things. Sorry but if you leave your job and have $1300 saved say.. you then get that check in the mail.. the fact is MOST people don't roll it over. This whole thing of if < $5K then send them a check is a serious problem. 2) too many companies no longer match..so when your company isn't matching the incentive is really not there 3) while target dates are great, small companies are being hosed and their plans are terrible. 4) who educates these people to invest?? ie a poor person has never bought a stock in their entire life, so you aren't learning it from your parents, and your not learning it from school, so you get the 20 minute talk from the 401k advisor who wants to take 1-2% of your money to invest for you. robbing the poor even more blind.
The 401k is great for people in the upper tax brackets, that have matching, that make enough money to max it out every year and know how to invest and have the options to invest. It was really my only write off when working.. saving me 1000s on taxes, sure I'll take that any day. I just don't know if I'd think the same if I was in the 15% tax bracket with bad funds, no matching.. I'd much more likely be putting money into a ROTH IRA...and since you don't make that much, the limits there suffice.