Most of us who work in the US have retirement benfits provided by our employer. One such vehicle is 401(k). Typically the employee defers a certain percentage of their salary and the employer matches a percent as well. Now my question to you all is:
- do you monitor your portfolio: if so, how often do you monitor your 401(k)
- do you rebalance your portfolio when market conditions are detrimental to your portfolio or if your investment is not diversified.
- does the 401(k) plan contain a variety of investments to choose from that you are comfortable with.
If your employer does not provide you with a retirement benefit, what are your doing to save for retirement?
These are just questions that I thought we could discuss.
It’s very Interesting topic. For some reason in this section not many people are participating. This is what I did.. When I was working company matched upto 4 or 5 %. We had the freedom to choose the funds.. I think they had 16 to 18 funds In which we can choose eg: Mid cap,small cap etc..Also they allowed putting 25% in the company stock. I used to change the portfolio when ever I felt like. But if the company stock doesn’t do well. normmally all funds invested was like law of averages. It just did like market.
Thanks for the response Tulasi - I am trying to get some participation in the money matters - but am not seeing much interest in it. I know from personal experience where I used to work, that too many people did not take advantage of this benefit. When company's have the matching, it is like free money - it blows my mind that some folks do not take advantage of this. Hopefully, you and I can get more people to participate!
When i was working, all my 401k funds were invested in High risk funds. My hubby put his in a more diversified portfolio in his previous company. I guess, we are limited to the choice of funds that the 401K managing company has to offer. Now all of our 401k funds from previous employers is being managed by American Express Financial Advisors. I think he has invested in a balance of Bonds, Low risk and high risk funds . And he has done a good job so far.
My hubby's present 401K fund am not sure , i have to check to see how he has invested it.
A very good topic to discuss. My husband is presently a consultant. His company does not offer 401k plans. So we have invested in Roth IRA. I am on H4 and so a home maker. Even I can invest in Roth IRA. We have Roth IRA separetely for each of us. My husband also has his previous company's 401 k plan which he monitors.
I would recommend ladies to increase their knowledge and awareness on these matters though husbands are taking the lead in most houses. In my case I am equally aware as my husband as to what happens to our funds, where its invested etc. I gained most of my knowledge by watching the PBS Program NIGHTLY BUSINESS NEWS everyday. There are professions recommending which stocks and bonds to buy , when etc. You can take their inputs and decide on making the most of your money.
Though I'm not much aware of the stocks and funds.. I know that my hubby monitors his 401K periodically and I thought the tips from this thread would give him a helping hand.
Glad to see interest picking up in this thread. As "eagle" has mentioned, if you or your spouse does not have a company provided benefit, you can save in a Roth IRA as well. In fact, subject to income limitations, one can also put money in a Roth IRA even if you are covered by 401(k) plans. From my professional experience, many people, put money in retirement plans and then do not monitor it - if you have a family of funds that is offered, the money invested should be well diversified and monitored so that your diversification is not skewed towards any one sector.
Very well Said Shobana, I am not surprised at all. I have seen lot of my colleagues they just don't monitor their finances.. they will work two more hours to get a small raise but they don't spend time to manage their personal finances..I used to tell them, guys, you are looking at the peanuts and loosing the big picture. some at least got some idea after me telling constantly.. some will never get it. I pity them. It will be too late by the time they realize.
Tulasi
Last edited by Tulasi; 13th September 2007 at 04:06 PM.
Dear Sobhana,
Yeah, this is one interesting topic with several cons and pros...........
My company has 401K plan and the matching % also differs in different companies, say from 3-6% of the money you keep and there is also a limit of your deposit.
About the benefits, you will get these after your retirement, say after 60+ age. And if you plan to withdraw your money before the retirement, you have to pay tax on the whole amount. This way, though you will not loose your money but the benefit will be minimised and getting some free money will not have any place here.
But anyways, if you have to stay here forever, its a good idea to put your money in 401K.
Also, John Hancock (our 401K provider) used to send us detail information about our money in quaterly basis. But we can also check it any time from the website provided to us.
But there are other plans where your money can be deposited and you can draw a good amount of interest from your deposit and you can can take your money out from that any time as per your wish.
Regards.
I know that my hubby monitors his 401K periodically and I thought the tips from this thread would give him a helping hand.
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