Newbie needs help in investing, 401k (bonds, fund, cash, 401k plan)
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I'm a newbie and I have NO IDEA how to invest my 401k for the best return. Right now i have 100% invested in my company's stock. But I know this isn't good. Would maybe 50% in index funds or 50% in the company stock be the best for my 401k return? Or Mutal funds? I'm clueless on all this stuff.
If you weren't working at your current job, would you think that the company stock you're currently invested in is so fantastic that you would have half (or more) of your retirement capital invested in it?
never never never never put alot of retiremrent money in your company stock at work. you can loose a job and your savings if anything happens to your company.
that should only be done with discretionary money.
i have made it a point never even to invest my own industry. why? because i see things that companies come out with that the rest of the world doesnt care about.
my best buddy was in the commercial phone installation business. despite my warning him he put 400k into lucent technologies. they had the greatest inventions and things on the drawing board but the rest of the world didnt care or didnt know what it was . he lost a fourtune!......
never never never never put alot of retiremrent money in your company stock at work. you can loose a job and your savings if anything happens to your company.
that should only be done with discretionary money.
i have made it a point never even to invest my own industry. why? because i see things that companies come out with that the rest of the world doesnt care about.
my best buddy was in the commercial phone installation business. despite my warning him he put 400k into lucent technologies. they had the greatest inventions and things on the drawing board but the rest of the world didnt care. he lost a fourtune!......
Ouch. My previous employer had a large match with company stock for the 401k program. It got to be almost 40% of my portfolio in that account. I need to roll it over asap, never know when the wheel of misfortune will land on your employer...especially in oil.
I'm a newbie and I have NO IDEA how to invest my 401k for the best return. Right now i have 100% invested in my company's stock. But I know this isn't good. Would maybe 50% in index funds or 50% in the company stock be the best for my 401k return? Or Mutal funds? I'm clueless on all this stuff.
Please help..
thanks
Stay away from Company stock in your 401k (even though they want you to invest in it.)
I'm assuming you probably have 30 years or so until you'll be looking to take out for retirement, so if thats the case you'll want to be invested primarily in equities....
I'd stick w/Index funds (hopefully vanguard manages your 401k plan) because some active funds WILL beat their benchmarks, the problem is we cannot identify which ones will do it (before the fact.)
the thing i always point out is its not about a fund beating an index.its about your entire portfilio working together to meet your goals of gains and risk.
many times people have one or 2 of the best performing funds but then have a portfolio that fails in a down market,or bets on only one economic out come like prosperity. or the portfolio is far more volatile than their stomach for risk and they bail at exactley the wrong time loosing real money.
its the sum of all the parts that determine your outcome, not beating the markets with a hot fund or indexing that determines your final outcome... there are quite a few conservative portfolio ideas that have beaten the equities markets many times with just a fraction of the volatility.
not loosing as much in the valleys means not needing such big gains in the peaks to come back.
Last edited by mathjak107; 07-22-2011 at 03:54 AM..
Well, I invested that much in the company stock because for the last couple of years its been steady above 100%. Today its @ 104.35... But i've changed it.
As of today I'm doing:
40% index funds
30% a semi conserv. bond
30% c. stock
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