My feelings are much the same as @chris simmons.
If you have a full time job and your employer provides a 401(k) company match, then at a minimum you should be contributing enough to get that employer match. To avoid fees and in an attempt to preserve your capital the smartest move is to invest your 401(k) money in index funds, unless you have the knowledge and risk tolerance to make better choices inside your 401(k) plan.
Too often the choices available in 401(k) plans are really bad and if you are not careful you can do poorly with that investment.
That was the case for me. I had several 401(k) plans with past employers that I just let sit in their plan because I was lazy. It ended up costing me some growth. Recently I rolled over all those old plans into a self-directed IRA at Charles Schwab and now my returns are much healthier and the fees have dropped as well. I still have some "rogue" IRA's that I will consolidate into another self-directed IRA for REI purposes.
Investing is a state of mind and each person has their own level of risk and ideas as to what is a good and bad investment. Diversification is not as rosy as Wall Street people would have you believe. It is better than nothing, but if you have the tools and education you can target your investments. One of the best books I ever read was One Up On Wall Street by Peter Lynch.
Investing in REI is also challenging and rewarding. It does not have to be an all or nothing proposition.
Good luck to all!