10 things you must know about your 401k

When you start a new job, one of the first decisions you'll likely make is whether to participate in the company's 401k plan. Here's what to know about that plan.

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For those who invest in their company 401K, I highly recommend they pay close attention to any and all "fees". The banksters are getting very rich playing with our money and we're the ones taking all of the risk. They make their money on "fees". By the time we retire, we will have handed these banksters over 1/3rd of our retirement money. 1/3rd times the number of 401K's they handle makes for a handsome profit for these fraudsters.... oops, I meant banksters.  These "fees" used to be hidden until laws were passed to help us consumers understand where our money was going. 
Oct 1, 2013 11:38AM
It's really sad that most people are so uneducated when it comes to money.
Oct 1, 2013 12:42PM
Mark my words. If you have saved for retirement you will be penalized one day. Your retirement income will be means tested and you will be taxed. Your wealth will be redistributed.
Sep 5, 2013 7:20AM

FINRA regs actually do work for you. Your employer is required to set up a reasonable selection of investment options, ranging from a money market to company stock to a menu of mutual fund offerings, ideally through a low cost fund family (we used Vanguard for years). Employee education must be offered as well, although the employer may not advise you directly. Unfortunately, most employees do not take the time to learn about the plan or the options available to them. My suggestions?

1. Know the rules. Try to take advantage of all the free money (the match) available.

2. Know the options. Diversify. You don't want a money market fund, and you may not want all company stock.

3.Know where you stand. Read your plan summary. Balance your investments. If a high flying fund has soared to unsustainable levels, take some of the gain and move to more predictable options. (remember the tech bubble? real estate collapse?)


90% of 401K gains go to the top 10% of 401K participants. That's because they understand the rules of the game.

Sep 7, 2013 3:49PM

11.  Not only are your contributions tax deferred (if not a roth), you may also qualify for Form 8880 Savers Credit.  A powerful incentive for those who struggle most to contribute. The nonrefundable credit has the power to knock your tax down to zero. Check to see if you might qualify.


12.  $17,500 (for those not yet 50 years of age) is the maximum TAX DEFERRED amount you may contribute to your 401(k).  You may continue to contribute as after-tax contributions. If you are in such a position, however, do read up on highly compensated employee rules of your plan.


13.  Don't borrow or take contribution holidays.  You are risking and compromising your senior self's security.


14.  Don't get discouraged - after a few years you will see a huge compounding effect.


15.  Hold steady in downturns and consider increasing your contribution while markets are on sale - really makes a good difference. If you have heard the term 'dollar cost averaging' buying on sale lowers your average share cost. That is a good thing. 


16.  Unsure about the multitude of funds to choose from?  An age indexed choice, if available, may be just the right place for your contributions.  These funds gently move more conservative as you near retirment for you.

Sep 5, 2013 4:10AM
Pay close attention to your company match!   I noticed that my company was matching 2/3rds on up to 6% of my pay only when my contribution was equal to or greater than 6% but less when my contribution was smaller than 6% of my pay; then, they only matched 2/3rds of that amount.   I realized late  that if I maxed out my contribution before the end of the year, I would loose some of the matching contribution since there would be pay periods at the end of the year in which I could no longer contribute.  They continued to do that until I noticed and started adjusting my contribution so that I didn't max out before the end of year.  I hate to think that they were intentionally shorting me on the match.  The year after I started making the adjustments, I received an email from the plan administrator informing that I would not have to make those adjustments, that they would take care of it for me.  Had I not noticed,  I wonder how much longer they would have kept shorting me on the match?  Scum bags, all of them!   They will cheat you out of your compensation at every opportunity!
Sep 5, 2013 3:17AM
You be lucky if your money don't shrink instead of grow over 20 years.  I watched my money go no where between 1992 when I first started investing until 2012.  It went up and then it fell back.  More than once as I remember.  The only people that made any money were the fund managers.  I'm not saying you shouldn't save.  I'm just saying that you shouldn't put all your eggs in one basket.  I saved almost as much outside my 401K during the first twenty years as I accumulated with my maximum contribution and company match. 
Oct 1, 2013 10:37AM
Know this.  If you have anything, Obama will take it from you and give it to the lazy ones.  It's only fair!
Oct 1, 2013 1:28PM
Know this about your 401-K, IRA, or ANY retirement account you may have.  As CONgress sinks this country further and further into oblivion, they will TAKE whatever you have!  Just KNOW that!!!!
Oct 1, 2013 2:20PM
There are a lot of negative comments being offered here, but some of these 401(k)s are good plans.  Ask your employer about the fees.  Some of the companies are paying the fees out of pocket so your money is not being charged the fees.  Instead of complaining, why not just look into it.? So if you contribute, say, 5% and your employer matches that, and your employer pays the fees, why not take advantage of that?  For example, if you make $25,000 a year and contribute 5%, that amounts to $1250 a year, before taxes, that does not drop your net pay by 1250, it drops your net by maybe 1000, so now you have lost only 1,000 of your own money in spending power but you have saved 2500, and that $2500 has earned some profit too in the investment you have chosen.  How can that not be good?  There are always going to be people who complain about every little thing, even something that is offered to you with no strings attached.  Yes, there might be restrictions on how long you have to work there before you get $100 of the matching funds, but my experience is that you end up working in a job a lot longer than you planned.  Those people who complain about 401(k)s without knowing much about them are the same people who complain that they can't live on Social Security.  Maybe you should have spent every cent you made and thought about the future once in a  while.  I admit that it's hard to think of the future when you are twenty-five, but one thing I can tell you is that if you put a few thousand away every year starting when you are twenty-five paying for your retirement or your kids college education may not be completely impossible when the time comes.  It might be nice to know that if your world comes crashing down, that you've got that little bit tucked away for emergencies too.  If your employer is offering you something for nothing, instead of scoffing at it, try learning something about it.  Free doesn't sound so bad to me.
Oct 1, 2013 2:39PM

Keep an eye on the Federal Reserve. Bernanke is propping up Wall Street with the infusion of 85 billion a month of printed new money. It has to come to an end soon or our economy will continue to sputter along because the 1 %, who have a love/hate relationship with Obombus, our socialist leader, who blames them for his poor economy, while taking all of the campaign money he can get from them for his Democrat/Socialist party; are getting richer. When the "feed-sack" is empty the market will tank and their goes your money. Buy some gold or silver, maybe 10% of your portfolio. Gold and silver will never be zero, while the dollar will be zero if this madness continues on a monthly basis. Also all of these college educated idiots that profess to be economist, apparently did not learn that John Maynard Keynes, method of using stimulus money to fix a recession, does not work, has never worked and will never work. Capitalism is the only way to fix the economy, quit the over-regulation, over taxing of the businesses that want to provide jobs and grow, and watch the economy start to grow, revenues will come pouring into Washington and the deficit will shrink because people will be earning a living as opposed to being given a living. It is a fact: less taxes,  more revenue, more taxes less revenue. Perhaps those Communist Econ Professors should resign because they are inept propaganda teachers. Let  Freedom Ring, and get Obamites out of our lives.

Sep 5, 2013 8:26AM

Okay the fees charged are not an average of .63% as quoted in this piece.  That is the quoted fee of the mutual funds.  On top of that the fees paid to the 401K administrators is is in the neighborhood of 1% even after some companies pick up some of these fees it is closer to 1.5% if your company does not pick up these fees.   Now the fees for the mutual fund to trade and do whatever they do to generate money for all their friends and banking contacts on Wall Street approaches 2%.  Thus you are paying a total of at least 3.63% each year win or lose in the market for the right to let someone else hold your money, this is the least you are paying and could be in the 5% range.  Throw in inflation even at low rates of 1.5% and you have to make 5.25% to 7.5% every year to just protect your principle. 

No wonder the average return on 401K funds after inflation is under .5% yes that is point 5 or 1/2 of one percent over the last 10 years worse if you go back to 1998 it is negative since then. 

Oh wait that is when banks were allowed to become brokers (remember Glass Stegall Act was dropped then).  Only the 1% on Wall Street get rich off of 401Ks.  Roll yours into a bank fund that you control investing in and buy long term stocks with decent dividends and let it ride.  After you get over $100,000 in the account the only fees you pay are the ones you decide to do when you buy or sell a stock, or EFT if you are a gambler.

Oct 1, 2013 11:08AM
I know after going on Obamacare that I will putting less in to it
Sep 5, 2013 4:52PM
...most people I know cant afford $500 a month in savings. More like $5. What planet do the people that write these articles live on??
In light of the "last economic downturn"....Nothing like "gambling" with your retirement.
Oct 1, 2013 6:56AM
 I do think it is a good idea to save but you have to keep in mind on rate of future taxes so Roth might be the way to go to keep taxes in check.  The majority of the growth you do make will go to taxes and as everyone knows taxes keep increasing.  I have been contributing the limit for 28 years since1987 when taxes were less and when I do retire will probably  be paying a high rate in taxes. 
Oct 1, 2013 10:55AM
I invest in my 401k up to what my employer matches, but also save more of my money in a saving account.  Don't trust 401k's much.
Sep 6, 2013 10:35PM
401K,s are meant for you to take a small percentage out each year after you retire. You will pass away befote you spend it all. I recommend to buy in monthly installments, 5 different blue chips stocks that pay descent dividends, and when you retire, try to live off the dividends with the option os selling the stocks for the cash without the hefty fees 401k,s charge you.
Oct 1, 2013 9:29AM
I have some money that I roll over from my 401k to an IRA ..... and I was charged over $4,000 is that  the way is suppose to be ? ... it seem to me outrage .. now I am in a position where my money I have saved for so many years  it is so small will not last for my retirement as I  originally PLANED ... any body has ideas ?
Sep 4, 2013 10:39PM
when 10 dollars buys a gallon of gas, you will feel the love. 
Oct 20, 2013 6:06AM
Retirement is an illusion . Wake up America !!!!!!!!
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