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the truth lies in the numbers..you need to compare against the similiar funds outside the 401k...dont tell me about how you were down in a decade with 2 back to back recessions and thats why 401k's are a scam...
im not saying there arent plans with high fees ,high trading costs and sweet heart deals if a company isnt careful but certainly any company with vanguard or fidelity is getting a fair shake and that represents millions of folks.
the show missed alot of points from the opposite view.
my own expierences are people take no interest in even understanding what they are investing in .. they have no interest in learning ,then they blame the 401k plan for the choices they made,..
they will research a car or refrigerator for months, but just put their investment portfilio together blindly watching what co-workers do .
they have no overall plan or goal.throwing endless amounts of money into a stock fund with no rhyme or reason isnt a balanced portfolio
they dont understand their own risk tolerance and bail out and loose money because they copy their buddies actions then they time it wrong going back in and of course all the time we were down they stopped contributing instead of buying...
most folks wouldnt save a dime left to their own devices unless forced by company deductions...
dont blame the vehicle, blame the lack of financial education most of america has or even has no interest in getting. its much easier to blame everything and everyone around them for their own financial suicide.
I am SO glad I took all my money out of our 401k's after we became self employed. I rolled them into IRAs at Schwab, and invested it myself. Instead of the two or three choices of very risk averse benefits managers, I get to make real money, by being able to choose from what 5000 funds?
My retirement is all nice and moderately aggressively invested. Yay, us!
I am SO glad I took all my money out of our 401k's after we became self employed. I rolled them into IRAs at Schwab, and invested it myself. Instead of the two or three choices of very risk averse benefits managers, I get to make real money, by being able to choose from what 5000 funds?
My retirement is all nice and moderately aggressively invested. Yay, us!
Pretty much did the same.
I had a 401k back when I was a W-2 due to the tax advantages and employer matching.
Once I quit and became a contractor elsewhere I kept it for a while and didn't touch it. However I was starting to get to the point where I wasn't liking what was going on. The funds were buying stocks that I thought were stupid buys and plus I noticed there was a significant skim. I was finally able to rollover after losing 50% of value in 2008 and for 20 months I've had it in a SEP IRA and by investing myself I've regained all I lost plus have a portfolio of stocks I am happy with.
It's almost a no-brainer to roll a 401k into an IRA with a company like Vanguard, Fidelity, Schwab, etc. you'll always have lower fees and a larger array of fund choices. Hell most of 'em have target retirement date funds now that handle the asset allocation for you as you age.
A 401k is simply a tax advantaged savings vehicle with stated management fees usually containing a mix of mutual funds that in turn each have a stated expense ratio.
The last 401k I was in the management fees were 1% of assets annually, and the bulk of my holdings were in a S&P500 index fund with an expenses ratio of .18%. The management fees being a percentage of assets did bother me some since someone maxing out their contributions got the exact same services from the company as someone who put in $50/paycheck but paid way more for it, but I accepted that since I anticipate a much lower tax bracket in retirement and I already max a Roth.
I had a 401k back when I was a W-2 due to the tax advantages and employer matching.
Once I quit and became a contractor elsewhere I kept it for a while and didn't touch it. However I was starting to get to the point where I wasn't liking what was going on. The funds were buying stocks that I thought were stupid buys and plus I noticed there was a significant skim. I was finally able to rollover after losing 50% of value in 2008 and for 20 months I've had it in a SEP IRA and by investing myself I've regained all I lost plus have a portfolio of stocks I am happy with.
So you pulled your $$ out at the lowest point, re-invested it, and think you are smart because you recouped your loss on your own?
It's not that you were smart it's the market that did that. I sold everything out of my 401k and put it in emerging markets when the crash happened and I did the same and that was in a managed 401k fund.
401k's allow you to purchase the same mutual funds you'd be buying in a IRA/Brokerage account (albeit a smaller selection for liability sakes). You'd pay virtually the same expense ratio investing outside of the 401k as you would if you buy it protected in a 401k. In some cases less.
So you pulled your $$ out at the lowest point, re-invested it, and think you are smart because you recouped your loss on your own?
It's not that you were smart it's the market that did that. I sold everything out of my 401k and put it in emerging markets when the crash happened and I did the same and that was in a managed 401k fund.
401k's allow you to purchase the same mutual funds you'd be buying in a IRA/Brokerage account (albeit a smaller selection for liability sakes). You'd pay virtually the same expense ratio investing outside of the 401k as you would if you buy it protected in a 401k. In some cases less.
Previously I had planned on keeping the 401K intact and having my SEP IRA also but what happened was right when the global crisis hit big time in October 2008, my old w-2 company was sold off to a large corporation and I had to get rid of the 401K and roll it over within a certain # of days or it would get disbursed to me in a check of which I would pay taxes and penalties on. My hand was forced whether I wanted to or not. However I wasn't happy with the situation anyways so it worked out fine in the end. I like being able to pick what I want, when I want.
In college I paper traded stocks and I did very well at it. I'm not big on mutual funds personally. I prefer to identify companies that I like and think will do well and buy a chunk of the stock.
OK but that doesn't refute what I stated. A monkey could've made money had they invested in pretty much anything after the crash until now. It's done nothing but go up.
as they say never confuse genius with a bull market
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