1/10/2013 4:30 PM ET|
6 ways to ruin your retirement
Mistake No. 4: Leaving the account in limbo
Just leaving your retirement account with a former employer is also a bad option, Hottin says.
"If your former company downsizes or is acquired by another firm," he says, "finding some contact who can help you retrieve it at a later time could be a hassle.
"It's better to take your 401k with you and mix it in with your new employer's plan -- or roll it into an individual retirement account of some type so you can manage it a bit better." If you do an IRA rollover, make sure it's a trustee-to-trustee transfer.
Rolling it into your new employer's account will give you continued creditor protection, says Green. "Even if you default on loans or you're a defendant in a lawsuit and lose, nobody can touch the money in your 401k or 403b." Depending on the state you live in, he says, your money might also be protected in an IRA.
Mistake No. 5: Too much company stock
Financial advisers say you should have no more than 10% of your retirement account in your employer's company stock. If you're concentrated in a single security, you get hit with a double whammy if your company hits hard times and you lose your job.
"Having company stock in a 401k plan is good for the company in a few ways, but it's a bad idea for the nonowner employees in many ways," Gordon says. "If you're thinking, 'What about the Facebook or Google employees who are now millionaires because of their stock?' don't confuse luck with skill. On the streets of this nation, there are many former employees of Enron, PanAm, WorldCom and others who also believed in their company's stock."
Sometimes, companies make their stock available to employees at a discount through stock options or other direct-purchase programs, he says. If you're tempted, "you are probably best served by taking advantage of the discount and realizing the gain on the discount as soon as (feasible)."
Mistake No. 6: Ignoring the big picture
Your employer-sponsored retirement plan is just one leg of the proverbial three-legged stool of a retirement plan.
"One of the largest mistakes is lack of planning in a holistic sense," Hottin says. "People fail to consider their retirement plans as part of the bigger picture. Your employee retirement account should be part of an overall strategy of financial well-being."
In other words, Green says, the term "retirement plan" should refer not just to tax-qualified plans such as IRAs and 401k's, but also other sources of income such as Social Security, company pensions, part-time work and other money saved up -- "your overall plan for how you're going to get through the remainder of your life."
Of course, many variables are beyond your control: You don't know how long you will live, how your investments will perform or whether you'll encounter an unforeseen expense that could derail your plans. So the best way to plan for the unexpected is to spend less, invest as much as you can and choose investments wisely.
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VIDEO ON MSN MONEY
< No.7 > A SURE-FIRE WAY TO RUIN YOUR RETIREMENT IS TO INVEST YOUR ASSETS, ESPECIALLY YOUR RETIREMENT SAVINGS, WITH FISHER INVESTMENTS! TO THE CONTRARY, VANGUARD GROUP, INC. OFFERS MANY EXCELLENT MUTUAL FUNDS WITH OUTSTANDING PERFORMANCE (% RETURNS) WITH VERY LOW EXPENSE RATIOS STARTING AT 0.25%. COMPARED TO FISHER INVESTMENTS' EXPENSE RATIO OF 1.36%, VANGUARD'S IS ALMOST 1/6th OF WHAT FISHER INVESTMENTS CHARGES! IN OTHER WORDS, FISHER INVESTMENTS CHARGES ABOUT 550% OR 5.5 TIMES MORE TO MANAGE YOUR RETIREMENT ACCOUNT THAN DOES VANGUARD, BUT FISHER INVESTMENTS PERFORMANCE IS RATED "POOR," AT BEST (5 years annualized returns = 0.41%). As a former FISHER INVESTMENTS client, I speak from my own personal investing experience -- FISHER INVESTMENTS will literally devastate your retirement portfolio as it did mine! Give yourself and your family a GOLDEN OPPORTUNITY to enjoy a financially successful future/retirement -- BE AWARE and BEWARE of FISHER INVESTMENTS! Scrutinize the data below for yourself; keep track of the PURISIMA TOTAL RETURN MUTUAL FUND (PURIX) on this MSN Money website. MorningStar data and statistics (shown below) tell the REAL STORY about FISHER INVESTMENTS; DO NOT fall for their slick, emotionally-charged "snake oil" ads on MSN Money and most financial websites:
(PURIX), A Mutual Fund “Actively” Managed by FISHER INVESTMENTS (KEN FISHER, CEO and Principal Owner). The Portfolios of FISHER INVESTMENTS “Private Client Group” Mirror This Data and Performance Returns!
**(2-Stars in 5-Star Rating System)
Net Asset Value (NAV)
1.36%, EXORBITANT in relation to its POOR PERFORMANCE*
* (% annualized returns)
Last NAV update 1/25/2013 4:00 PM ET
CUMULATIVE PERFORMANCE OF $10,000:
Year to date performance as of 1/24/2013 7:00 PM ET
* Annualized returns. Performance as of 1/24/2013 7:00 PM ET
Avg Market Cap
The Morningstar Rating for mutual funds, commonly called the "star rating," brings both performance and risk together into one evaluation. Morningstar adjusts for risk by calculating a risk penalty for each fund based on "expected utility theory," a commonly used method of economic analysis. Although the math is complex, the basic concept is relatively straightforward. It assumes that investors are more concerned about a possible poor outcome than an unexpectedly good outcome and that those investors are willing to give up a small portion of an investment’s expected return in exchange for greater certainty. A "risk penalty" is subtracted from each fund’s total return, based on the variation in its month-to-month return during the rating period, with an emphasis on downward variation. The greater the variation, the larger the penalty. If two funds have the exact same return, the one with more variation in its return is given the larger risk penalty.
FISHER INVESTMENTS Strikes Against Former Client - a Newspaper Publisher
After a former client of FISHER INVESTMENTS, Jake Berzon (a newspaper publisher) wrote an opinion piece about FISHER INVESTMENTS, the company (FISHER INVESTMENTS) filed a frivolous arbitration case in an effort to intimidate this member of the press.. Breaking news from by Baraban.Com Odesskiy Listok / David Lusher/ in Fisher Investments,intimidation,interference,snowball,first amendment,freedom of the press, Investment .
FOR IMMEDIATE RELEASE -- (FREE PRESS-REALEASE.COM) February 24, 2008:
Jake Berzon, publisher of Odesskiy Listok newspaper was looking to free up some time from money management tasks to concentrate on pressing business and family matters. He thought he found his answer when he contracted with FISHER INVESTMENTS - a large private investment management company in Woodside, California. Their business relationship was a short-lived one, with Berzon firing Fisher within a month of hiring them. Berzon explains that his dissatisfaction with FISHER INVESTMENTS tactics grew daily: "Flashy "personalized" documents loaded with the same regurgitated rubbish rubbed me the wrong way right away. That was followed by tomes of required additional paperwork. Then, there was the unwillingness to communicate by email and refusal to supply basic performance data. The mutual fund-like positioned account didn't seem to make much sense, either. And it seemed like every security being added to the account immediately lost in value and significantly more so than the market in general. It's like FISHER INVESTMENTS knew exactly what not to buy!" Three weeks after canceling their contract, gathering additional data and analyzing FISHER INVESTMENTS practices, Berzon wrote an expose on FISHER INVESTMENTS posting it in on the newspaper website. The article quickly appeared at the top of search engines' rankings. And that's when FISHER INVESTMENTS, apparently took notice. First there was a call from a FISHER INVESTMENTS VP, who asked what FISHER INVESTMENTS could do to make Berzon happy. "There are only two things you can do, change your marketing materials to correspond to your business, or change your business to correspond to your marketing." Berzon thought that was the last that he heard from the company. Then in the evening of Friday, February 15th prominently among other responses, appeared a letter posted by FISHER INVESTMENTS legal counsel, Fred Harring. In it Haring was threatening legal action, claiming defamation of character based on misstatement of facts; raising demands for article removal and a published retraction. The following Friday, Berzon received a notice from FISHER INVESTMENTS outside counsel about their arbitration filing in San Francisco. This filing claims breach of contract, intentional interference with prospective business relations, defamation, trademark infringement, trademark dilution, injury to business reputation, unfair competition and unjust enrichment. Berzon is not folding: "I wrote down the facts and my opinions about FISHER INVESTMENTS. Their $2,000 breach of contract claim - just a poor ploy to attempt to use the canceled contract's arbitration clause and scare me into shutting up. Well, that's not going to happen; besides I have an email from their sales person confirming that I owe nothing! And by the way, over the past two weeks, I have done more digging, more research, more analysis and it will all be in the new article - a Fisher Investments feature story for the March issue of Odesskiy Listok."
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